10Case History #4 – Steel Company High quality rail road wheelsPoor labor relationsEmerged from bankruptcyProjection of $1.1 million in workers compensation losses per year.
11Case History #4 – Steel Company $38M sales, $3.5M W/C premiumSignificant evidence:ExaggerationMisapplication of benefits …workers’ compensation was used in lieu of health or unemployment benefits
12Case History #4 – Steel Company The SolutionSuccessful proactive loss prevention programSupervisors trained in accident investigations, modified duty, and profit consequencesSafety committee was refocused from complaint evaluation to injury prevention
13Case History #4 – Steel Company Results…First year:50% reduction in injuries66% reduction in costs$1M premium reduction
14Case History #5 – Pigment Manufacturer PA company bought similar VA companyDue diligence – W/C insuranceZero reported injuriesTrue?
22Loss Control vs Risk Control Loss Control (Traditional Approach)Manages Costs After Loss ExperienceIn Short, “Reactive”Insurance company responsibilityRisk Control (Alternative Approach)Manages Performance Before ExperienceIn Short, “Proactive”Your responsibility
23If Common TodayPoor PlanningLack of TrainingUnsafe ConditionsPossible TomorrowOn Site AccidentsInjury/Death
24Case Study #1 Client – Midsize Welding Gas Distributor Problem 30 vehicle units - 6 months9 preventable accidents2 non-preventable accidentsSolution - A structured programOutcome0 preventable accidents
25What made the difference? Commitment! Accountability Case Study #1What made the difference?Commitment!AccountabilityFirst Executive Safety Committee meeting – all OKSecond meeting – commitmentThird meeting - performance
26Why Practice Prevention??? Preventing losses IS possible!Always less expensive than traditional loss control approachesLess equipment damage and downtimeFewer customer issuesProfessionalism risesProfit is improved
2710 essential elements 1. Management leadership 2. Assignment of responsibility and accountability3. Maintenance of vehicles, equipment4. Pre-employment checks5. Establishment of effective safety committees and training
2810 Essential Elements 6. Accident record keeping system 7. Medical and first aid systems8. Acceptance of personal responsibility by employees9. Post loss management activity10. Results monitoring and program evaluation
29Management Techniques Systematic accident investigationsMajor, minor, near missNational Safety Council guidelines for determining preventabilityOperator and driver/supervisor trainingPersonnel and vehicle safety incentives & communicationDiscipline & accountability
30Benefits of Prevention HumanitarianLess painRegulatory ComplianceAvoid OSHA/DOT hassles, citationsFinancialLower costs, liabilities, down timeBusiness/Officer ProtectionDocumentation, manual, program
31How to measure the company’s real safety performance? Whose performance?
32Your performance How to measure… You (owners, line managers) are accountable … or can become accountableCase Study – Temporary Service EmployeesCase Study – Fraud, Pasadena, CA
34How to measure your real safety performance? Long term – W/C rate Professional, unbiased numerical appraisal
35How to measure your real safety performance? Short termNon-injury incidents (near misses)First Aid CasesRecordable injuriesLost workday cases
36FatalitiesLostTime CasesRecordable InjuriesMedical Visits/First Aid CasesUnsafe Behaviors/Unsafe Acts
37Insurance company structures (policy, rent-a-captive, captive, self) W/C InsuranceInsurance company structures (policy, rent-a-captive, captive, self)Premiums adjust for 3 years plus 1Do some insurance companies care about your performance?
38W/C InsuranceInsurance companies are designed to make more money when you have more injuriesCase Study - Rapid City
39Experience Modification Factor (XMod) W/C InsuranceExperience Modification Factor (XMod)Frequency – each injury counts as 1xSeverity – Lost workday cases count about 10x
40W/C Insurance - Frequency Control your frequency by stopping accidentsAccountabilityMeasurementTrainingOvert commitment