An Ounce of Prevention

Kate McGinn

No matter the industry, workers' compensation insurance continues to be a big expense for businesses. Required by all states, workers' comp covers the medical bills and lost income of employees who are injured while performing their jobs.

While the number of workers' compensation claims has dropped considerably over the years, the cost of those claims has not declined proportionately.

According to a report from the National Council of Compensation Insurance (NCCI), the cost of lost-time claims — claims that require time off from work — increased by 8.5 percent in 2005. The medical care portion of coverage rose 10.3 percent. These increases are attributed to more expensive prescription drugs and the greater use of hospital services.

The biggest cost-savings in workers' compensation come from preventing injuries in the first place. Waste firms need to be on the lookout for ways to create a safer workplace, which involves more than regular mandatory safety meetings. A broad array of factors can positively influence workers' compensation costs:

Employee Behavior

Ensuring that employees adopt the right habits — including knowing proper lifting techniques and using appropriate equipment like gloves and safety shoes — can help prevent a lost-time injury. It also involves changing employee behavior. Poor attitudes lead workers to make bad decisions, especially where safety is concerned. Employees who aren't involved in the safety process perceive that their opinions don't matter. Actively seeking employee input encourages workers to contribute to a safe workplace.

The Accountability Factor

Active involvement in a safe workplace demands greater accountability. Include disciplinary measures in safety programs to hold employees accountable for breaking the rules.

Greater Incentives

Just as employees are held accountable for their behavior, they should also be rewarded for it. Use incentives to reward accident-free truck drivers and route workers who avoid injuries.

Employee Health and Well Being

Obesity and inactivity warrant attention because they can contribute to injuries on the job. Reducing obesity in the workplace yields happier and healthier employees, as well as greater productivity. Healthy employees also take less time off due to weight-related illness, helping to control group health coverage rates. Therefore, many companies offer benefits like weight loss assistance and discount memberships to fitness centers.

Easing the Return to Work

To control workers' compensation costs, many companies establish transitional duty or a return-to-work program. These measures can reduce lost days and help facilitate physical recovery.
— Kate McGinn
XL Specialty Insurance Company
Exton, Pa.
www.xlinsurance.com