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Risk Management User Group Wednesday, January 28, 2004.

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Presentation on theme: "Risk Management User Group Wednesday, January 28, 2004."— Presentation transcript:

1 Risk Management User Group Wednesday, January 28, 2004

2 Welcome Michael L. Hay, CGFM, CPPM

3 Please hold questions until the end of all presentations.

4 Meeting Agenda n 8:30-8:40 –Welcome n 8:40-8:55 – Short Term Special Events, General Liability n 8:55-9:10 – Review of SORM 200 Data n 9:10-9:40 –Claims n 9:40-10:00– Trend Analysis & Accident Investigation

5 Meeting Agenda n 10:00-10:15 – Break n 10:15-11:00 – Life Safety Code 101, 2003 Update n 11:00-11:15 – SORM Fraud Team n 11:15-11:30 – Loss, Damage, & Destroyed Property n 11:30-12:00 – Questions & Comments

6 Short Term Special Events, General Liability Steven E. Haynes, ARM GRS Insurance Services, LLC

7 State Office of Risk Management Master Short Term General Liability Insurance Program n Background and Purpose n Key Elements of Program Outside Users of State Owned FacilitiesOutside Users of State Owned Facilities State Employees Using Third Party FacilitiesState Employees Using Third Party Facilities n Program Highlights Types of Events AvailableTypes of Events Available Underwriting GuidelinesUnderwriting Guidelines Coverages, Limits, and PricingCoverages, Limits, and Pricing

8 Application Process Application Process Key Contacts Key Contacts Marketing Material Marketing Material Summary and Questions Summary and Questions

9 SORM 200 Loss Data Summary Sally Becker CPCU ARM

10 History n Annual Report to SORM n FY02 – change in data collected –Loss type –Loss cause –Retain from year to year –Update previously entered data n February, 2003 – availability to enter all year long

11 Data – FY02 vs. FY03 OverallFY02FY03 Change % No. of Losses % Open Closed Amt. Pd. 5,665,1205,193,833-8% Res/Dmds615,379,6531,048,355,943 Lawsuits %

12 Automobile Liability FY02FY03 Change % No. of Losses % Open Closed Amount Paid 991,501524,462-47% Avg. Pd./Cld. 4,5692,115-54% Resr./Demands3,255,9141,998,551 Lawsuits %

13 Inattention FY02FY03 Change % No. of Losses % Open12487 Closed Amount Paid 799,050317,604-60% Avg. Pd./Cld. 4,7851,085-77% Resr./Demands1,594,948886,693 Lawsuits %

14 Backing FY02FY03 Change % No. of Losses 36386% Amount Paid 45,49737,966-17% Avg. Pd./Cld. 1,8191,085-40% Resr./Demands509,3721,825

15 Automobile Physical Damage FY02FY03 Change % No. of Losses % Open1063 Closed Amount Paid 227,140436,66792% Avg. Pd./Cld. 1, % Resr./Demands56,834216,332

16 Collision FY02FY03 Change % No. of Losses % Amount Paid 187,114190,9032% Avg. Pd./Cld. 1,9701,414-28%

17 General Liability (Third Party) FY02FY03 Change % No. of Losses % Open Closed Amount Paid 921,198406,325-56% Avg. Pd./Cld. 4,0052,673-33% Resr./Demands456,981,573652,382,766 Lawsuits %

18 Employment Practices FY02FY03 Change % No. of Losses % Open Closed Amount Paid 1,232,2702,059,17767% Avg. Pd./Cld. 11,84819,06661% Resr./Demands114,687,7048,248,000 Lawsuits %

19 Discrimination - Race FY02FY03 Change % No. of Losses % Amount Paid 41,000206,700404% Resr./Demands01,106,750

20 Retaliation FY02FY03 Change % No. of Losses % Amount Paid 16,0311,540, % Resr./Demands1,100,0004,630,000

21 Property FY02FY03 Change % No. of Losses % Open1529 Closed6289 Amount Paid 720,967669,089-7% Avg. Pd./Cld. 11,6297,518-35% Resr./Demands169,910212,852

22 Data by Date of Loss # Losses PaidResr./Demands FY98711,320,193106,458,574 FY ,6203,142,602 FY003152,545,92156,609,046 FY016193,011,97473,565,875 FY ,603,445542,820,186 FY ,354,722880,839,313 Total:344110,579,8751,663,435,596

23 Automobile Liability # Losses PaidResr/Demands FY981419,0358,574 FY991586,8970 FY ,434543,032 FY ,4821,100,594 FY ,7282,862,151 FY ,387740,114 Total:7431,485,9635,254,465

24 Auto Physical Damage # Losses PaidResr/Demands FY FY FY0021,1600 FY013497,5440 FY ,62670,036 FY ,165102,582 Total:424472,904172,618

25 Employment Practices # Losses PaidResr/Demands FY ,000105,750,000 FY991571,000100,000 FY00461,812,6220 FY ,7004,483,000 FY ,81712,102,704 FY ,750500,000 Total:5913,098,889122,935,704

26 General Liability (Third Party) # Losses PaidResr/Demands FY98169,850700,000 FY ,7193,042,602 FY ,37315,821,014 FY ,61461,511,786 FY ,136517,112,291 FY ,211531,919,146 Total:9631,270,9031,130,106,839

27 Property PaidResr/Demands FY00810,3320 FY018578,2590 FY ,381170,010 FY ,084212,752 Total:1961,390,056382,762

28 Important n UPDATE INFORMATION

29 Fax:

30 Terry G. Myers Director of Claims Operations

31 Claims Cost Cost to the Claims Fund vs Per Claim Costs

32 1 st Qtr FY04 Update n Medical and Indemnity costs through the end of the 1 st Qtr FY04 –Fewer open claims –Significantly lower costs

33 1 st Qtr FY04 Update n WCRI –Cost of WC Claims in Texas –Future Comparison with SORM Claims Costs

34 Claims Operations Reorganization n Realignment of State Agencies HHSC n Three Indemnity Claims Teams HHSC, TDCJ, ALL OTHERS

35 Combined Medical Management with Medical Only Claims Team n Medical staff and senior adjusters n Eight (8) medical only adjusters

36 ACCIDENT INVESTIGATION/TREND ANALYSIS ON-LINE TRAINING Leonard Zolondek

37 Events & Training

38 Safety Puzzle

39

40 OVERVIEW n INVESTIGATION PROCESS n OBJECTIVE n WHAT n ROOT CAUSE ANALYSIS n TREND ANALYSIS

41 PROCESS

42 WHAT

43 Accident Causation Theories There are a variety of theories on accident causation that can be grouped into the following categories: Domino Theories which view accidents in three phases: pre-contact, contact and post-contact. Multiple Causation Theories which view causes based on a variety of factors such as man, machine and the environment. Psychological/Behavioral Causation Theories which focus on human behavior as the major cause of accidents Energy Related Causation Theories which view accidents as a result of energy that is out of control.

44 ROOT CAUSE ANALYSIS n SCIENTIFIC PROBLEM SOLVING METHODS –Fault Tree Analysis –http://reliability.sandia.gov/Reliability/Fault _Tree_Analysis/fault_tree_analysis.html _Tree_Analysis/fault_tree_analysis.htmlhttp://reliability.sandia.gov/Reliability/Fault _Tree_Analysis/fault_tree_analysis.html –Fish Bone Diagram –http://www.pathmaker.com/resources/tool s/cause.asp s/cause.asphttp://www.pathmaker.com/resources/tool s/cause.asp

45

46 Fishbone Analysis

47 Lamp Wont Work

48 Plug/Cord Lamp Wont Work Bulb Power

49 Plug/Cord Lamp Wont Work Burned out Loose Bulb

50 Power Plug/Cord Lamp Wont Work Broken Switch Missing Switch Corroded Burned out Loose Bulb

51 Power Plug/Cord Lamp Wont Work Unpaid Bills Switches Storm Broken Switch Missing Switch Corroded Burned out Loose Bulb

52 Power Plug/Cord Lamp Wont Work Unpaid Bills Switches Storm Dogchewed Unplugged Broken Switch Missing Switch Corroded Burned out Loose Bulb

53

54

55 TREND ANALYSIS n IDENTIFY BASIC FACTS n SHOW POSSIBLE PATTERNS/TRENDS n ESTABLISH PRIORITIES FOR SAFETY ACTIVITIES

56 ASWG CODES Effective June 1, 1997 the Commission adopted revised Advisory Statistical Work Group (ASWG) codes for Nature of Injury, Part of Body, and Cause of Injury. These code changes aligned the Commission's reporting requirements with the International Association of Industrial Accident Boards and Commissions (IAIABC) Electronic Data Interchange (EDI) reporting standards. The ASWG codes are available to EDI participants through the IAIABC. If a carrier or trading partner has previously purchased an IAIABC Implementation Guide, the IAIABC will provide a list of all the ASWG codes as an update to the Guide. If you are interested in purchasing an Implementation Guide, you can contact the IAIABC directly at 1201 Wakarusa Drive C-3, Lawrence, Kansas, or by phone (785) The IAIABC has also made the codes available via their website at Once you have reached their web page, choose the EDI folder and available options will be listed.

57 Examples of categories to include in the analysis should at least be the following: A. Department: B. Job Title: C. Agent Involved: (ironing press, material cutter, fabric rolls, sewing machine, and clothing bundles) D. Experience: (1-5 years, 6-10 years, etc.) E. Body Part: (hand/fingers, back, leg, head/neck, arm and foot) F. Accident Type:(caught between, struck-by, struck-against, lift/lower, push/pull, etc.)

58 CAUSE OF INJURY – FY 01 & FY 00 As of August 31, 2001

59 CAUSE OF INJURY BY DEPARTMENT FY 01 & FY 00 As of August 31, 2001 AGGRESSION

60 CAUSE OF INJURY BY DEPARTMENT FY 01 & FY 00 As of August 31, 2001 STRAINS

61 Break Time! See you at 10:15!

62 Fraud Investigations Gary Ingram Julie Herrera

63 Workers Comp. Fraud Workers Compensation Fraud is committed when a person(s) knowingly or intentionally misrepresents, conceals, or omits a material fact to either obtain or deny workers comp benefits.

64 Workers Comp. Fraud (contd) Fraud is committed if a person knowingly or intentionally: Makes a false or misleading statement. Makes a false or misleading statement. Misrepresents or conceals a material fact. Misrepresents or conceals a material fact. Fabricates, alters, conceals, or destroys a document Fabricates, alters, conceals, or destroys a document Conspires to commit an act described by the events above. Conspires to commit an act described by the events above.

65 Fraud Investigative Unit n Investigate allegations of fraud n Validate SIBS, TIBS, and Death Benefits info n Validate suspect travel and prescription reimbursements n Assist DAs and TWCC in prosecution of fraudulent claims n Assist the claims adjusters, agencies, and claimants n Assist SORM in obtaining information that is utilized at BRCs and CCHs

66 Useful Tool EMPLOYEES RIGHTS AND RESPONSIBILITIES FORM RESPONSIBILITIES FORM

67

68 Recent Trends Military

69 What to do when you suspect fraud or abuse. n Call SORMs Investigators –Gary Ingram – (512) –Julie Herrera – (512) n Call your SORM adjuster or our main # –(512)

70 Lost, Damaged, & Destroyed Property Patricia OHara Systems Analyst (512)

71 Benchmarks n The State Auditors Office (SAO) recommended that SORM create benchmarks for LDD property. n Benchmarks will be based on the Class Code of assets, and an overall agency percentage. n An agency should have procedures for safeguarding assets. Risk Managers can contact their agencys property manager. n We should have the benchmarks in place this spring.

72 Appropriation Reduction n The Comptroller was charged by the 77 th legislature to reduce an agencys appropriations by 50% of the value of lost property, if the percentages are in excess of the American Society for Testing and Materials (ASTM) standards. This was implemented at the end of FY02 and was continued by the 78 th Legislature in Article IX, Sec of the General Appropriations Act. *Implementation Guidelines for General Appropriations Act, Art. IX, §9.03, 77th Leg., R.S. -- Appropriation Reductions for Lost Property html html html

73 LDD Definitions n Class Codes n Disposal Methods n Lost Damage & Destroyed Property n Historical Cost vs Depreciated Value n Property level vs. Component level

74 LDD Process n Missing Property n Stolen Property n Damaged/Destroyed Property n Negligence

75 Useful Websites SPA Class Codes and Annual Financial Report (AFR) Categories: afr_cats.html afr_cats.html SPA Disposal Methods for Fixed Assets: 2000/spauser_appd1.html 2000/spauser_appd1.html Missing, Damaged or Stolen Property Report:

76 Useful Websites (contd) State Agencys Property Managers ontact_list/spa/st_agy_spa_contacts.html ontact_list/spa/st_agy_spa_contacts.html State Auditors Office Report

77 Questions & Comments?

78 Risk Management User Group Thank you for attending. See you on April 28 th, right here!


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