IRMI Update—Issue #24
An E-mail Newsletter for Risk and Insurance Professionals
ISSN: 1530-7948
September 5, 2001
In This Issue
Colleague,
Readers responding to my last
editorial expressed
very definite opinions about the use of cell phones while driving as well as
related government regulations and corporate policies. I think you'll find the
"Your View" column at the bottom of this issue very interesting.
A few issues back I requested your help in hitting our objective of 10,000
subscribers during the month of July. You really came through for me—we now
have nearly 12,000 subscribers! I can't tell you how much I appreciate your
recommending IRMI Update to your colleagues and friends.
I also want to thank those of you who take the time to submit a Risk Tip
or provide your view on my editorials. Together we are sharing ideas that will
not only save our organizations some money, but more importantly will save human
lives. And saving lives is the ultimate pay back of good risk management.
We hope to see you in late October at the 21st IRMI Construction Risk Conference
in New Orleans.
Have a terrific day!
Jack
Jack P. Gibson, CPCU, CRIS, ARM
President
IRMI
Share the Load To Reduce Lifting Injuries.
We provide the workers compensation insurance for a grocery wholesaler. The
wholesaler decided to expand its business to offer quartered beef to its customers.
They delivered the quarters to retailers with their own employees and vans.
To reduce some of the risks associated with handling the beef quarters, rails
with overhead hooks were installed in their vans. However, the wholesaler's
employees still suffered back and shoulder injuries carrying the quarters from
the vans into the retailers' premises. To solve this problem, we suggested using
a "stretcher," similar to those used by ambulance crews, to carry the beef quarters.
This simple solution substantially reduced the injuries from this new business
activity and should be adaptable to others as well.
By: Carl L. Anderson, CEO
TIC Insurance
Thief River Falls, MN
E-mail: carl@ticgen.com
Suggest
a Risk Tip. Future issues of IRMI Update will include more risk tips
from our readers. Send us a practical tip (less than 300 words) for identifying
and managing risks, buying insurance, managing claims, or filling gaps in insurance
coverages. We'll acknowledge your contribution as we did for Carl.
We add new Expert Commentary to IRMI.com every week. There are now 200 articles
on IRMI.com, and many more are in production. Below you'll find summaries of
some recent additions with links to the articles.
-
What Does the Word
"Comprising" Mean, and Why Should I Care?—In their intellectual
property law column, Sanford E. Warren Jr. and Kenneth T. Emanuelson examine
the negative nature of patent rights and the distributed nature of patent
right ownership, providing entertaining examples of each.
-
Conducting Proper
Environmental Risk Assessments—Without a universal or federally
mandated approach to ERAs, it is difficult to make proper, cost-effective
decisions regarding suspect property. Jeff Slivka explains the most commonly
used standards and offers guidelines.
-
Design-Build Engineer
Held Liable for Negligence—A complex court decision holds that
a developer is entitled to recover its losses from the design-builder who
employed the engineer and constructed the failed projects. J. Kent Holland
Jr. explains its significance.
-
Surety Industry
Addresses Increases in Surety Losses—Learn who the top 20 surety
writers in 1999 and 2000 are, including premiums and losses, in this article
by Lynn Schubert of the Surety Association of America.
What's New in the 2000
Edition ISO Commercial Property Forms: CP 00 30—These revisions affect
11 coverage forms, all 3 causes of loss forms, 24 coverage endorsements, and
a number of schedule endorsements. This article summarizes the changes to the
business income and extra expense coverage form (CP 00 30).
Focus on
Construction Defect in New Orleans—Construction defect is one of
the most problematic issues in construction today. That's why we'll spend a
full day of the IRMI Construction Risk Conference delving into the most common
areas of construction defect coverage litigation, such as application of deductibles
and SIRs when damages occur across multiple policy periods and the proliferation
of liability exclusions now being attached to contractor's policies. Given the
recent escalation in mold claims, some special attention will be given to insurance
coverage for mold contamination.
This is just 1 of 4 all-day seminars and 19 sessions and workshops to be
presented at the 21st IRMI Construction Risk Conference. We are now taking registrations
for the Conference. Visit the Conference
agenda for details about all
the sessions and the presenters. To register, just complete the
registration form or call (800)
827-4242.
IRMI Workers Comp Provides Knowledge for
Hard Market Survival—Workers comp prices are increasing nationwide,
and it is time to consider all your alternatives. Whether you need to evaluate
self-insuring your workers compensation exposure or improve your claims management
or safety program, IRMI Workers Comp gives you the knowledge you need. Many
publishers charge much more for less risk management information than you will
find in this unique IRMI reference. Visit
IRMI.com
for more details and a table of contents.
Our readers certainly have opinions about using cell phones while driving.
We received nearly 100 e-mails expressing opinions on Jack's August 21
editorial, in which he suggested that organizations
should consider developing a corporate policy on this practice. Many of you
articulated excellent arguments against the passage of legislation governing
cell phone use in autos. Many of you also agree that businesses and public entities
should adopt some type of policy to guide employees (and some even sent theirs
to us). Some of you also explored the issue of whether hands-free cell phones
were safer while driving.
Coincidentally, a new study just reported in the August/September 2001 issue
of the National Safety Council's Injury Insights shows that conversing on cell
phones while driving can lead to significant decreases in driving performance.
The study found that driver distractions due to cell phones can occur regardless
of whether hand-held or hands-free cell phones are used, and that cell phone
conversations create much higher levels of driver distractions than listening
to the radio or audio books. Check out the
article.
Unfortunately, we cannot print all the responses we received here and we
haven't had time to format them for the Web site. Therefore, we are providing
a selection of the e-mails that focused on cell phone policies below. In the
next few weeks, we'll post more of your opinions, including those expressing
public policy concerns on IRMI.com. We'd also like to include a sample policy
statement or two. If you'd like to send yours for consideration, please send
it via the MyView form.
- In the last 3 years, the city has experienced three total loss vehicle
accidents that were due to driver distraction during use of cell phones—two
by the other drivers and one by a city driver. Fortunately, because of seatbelts
and air bags, there were no serious injuries. The cost of these three accidents
was in excess of $100,000.
—Donald F. Anderson, Risk Manager
City of Olathe, KS
- The last Superintendent who was multi-tasking with a steering wheel
in one hand and a cell phone in the other rear-ended a family of four. It
cost the company $88,000.00 for the family of four and a new car for us.
By the way, he was talking to a supplier about a lower price on a box of
55-cent fasteners as I recall. Hope we got the discount!
I have changed my mind on simultaneous cell phone use and driving. Why?
Because mounting loss statistics and personal observations of numerous dunderheads
trying to drive and talk on the phone. I'm not for big government in any
shape or form, but I will support efforts of those who also agree that the
two, driving and cell phone communication, should not be done at once. There
is space for brief radio communication by trained EEs on my agenda.
—Peter Robertson, President
TRG, Sacramento, CA
- Your thoughts are right on target. It is essential for companies to
create their own cell phone policies, regardless of whether legislation
passes at the local or state level. Here are a few strategies that we advise
companies to use when developing and implementing such a policy:
Create a policy that works. Use a multi-disciplinary team to develop
a policy that is practical, legal, and reflects your organization's risk
tolerance. Some companies no longer provide cell phones and refuse to reimburse
drivers for cell phone-related expenses. Others permit or provide cell phones,
but very clearly specify how and when they may be used. If you allow cell
phone use in emergency situations, be sure to define what constitutes an
"emergency."
Reinforce the policy. Provide all new hires with a copy of the policy,
and review it in detail during their orientation. Cover safe cell phone
use in all driver training programs and in periodic reminders, such as a
newsletter.
Inform drivers. Ensure that drivers understand the reason for the cell
phone policy—including the increased odds of an accident, the potential
liability for the company, and the possibility of personal injury or fatalities.
Outline the ways in which cell phones pose these risks, so drivers will
understand how to reduce their odds of an accident.
Provide alternatives. Offer drivers practical options that recognize
their need to communicate while traveling. You might permit drivers to use
the phone only when safely pulled off the road. Or you might instruct them
to forward their calls to voice mail while driving to avoid being distracted
by an incoming call.
—Phil Moser, National Sales Manager
Advanced Driver Training Services, Inc., King of Prussia, PA
- Employers should adapt policies for more than just cell phone use. There
are studies that found cell phone use to be no more dangerous than trying
to eat, read, and apply makeup or any other activity that requires thought
while driving. From a company's perspective, anything which requires attention
be taken from the road should be prohibited while on company business. Such
a policy could say just that, "the primary function of the vehicle operator
is to drive the vehicle, should additional tasks be necessary, they should
be handled by a passenger/coworker or the vehicle should be stopped in a
safe place prior to undertaking any additional tasks which may inhibit safe
operation of the company vehicle."
—Vincent Johns, CPCU, AIC, HO Liability Examiner
UNIG, Utica, NY
- You might want to look into the recent study done by the FL Highway
patrol. Of 100,000 accidents in 6 months, only 600 were caused by driver
distraction of any kind. Cell phones were down that list in 3rd or 4th place.
So, it doesn't look like cell phones are the real problem. The problem is
inattentive drivers, who don't take the task of driving seriously and ALLOW
themselves to be distracted. Employers take on the liability and should
of course warn employees to be careful in all ways when driving!
—Lisa H. Harrington, CPCU, AAM, AAI, AIP, Director of
Education
Florida Association of Insurance Agents
- Our Risk Management and Safety areas have met to discuss such an issue
as a result of the lawsuit you reference in your e-mail. It appears that
at this point nobody we talked to has any kind of policy for the use of
cell phones while conducting business and they indicate that this is a touchy
issue because of how important the cell phone has become. Since the key
word in the use of cell phones is "distraction" this also applies to many
other things we do while we are driving. This makes it a little more difficult
to set policy for just cell phones. It is our intent to at least put together
a corporate-wide general policy regarding the use of cell phones while conducting
business.
—Jimmy E. Garcia, Supervisor, Risk Management & Insurance
City Public Service, San Antonio, TX
- It could easily be incorporated into the organization's Vehicle Safety
program. Where one doesn't exist, the organization should make it known
to employees who have cell phones that usage while driving is unacceptable,
except in emergency situations, personal or business. At the least, the
driver should pull over to the closest safe area to continue the conversation
or advise the other party he/she will return the call as soon as he/she
can pull over safely. Sometimes the nature of the call requires complete
focus and concentration, so there is a serious dilemma when driving requires
the same. Something has to give and it shouldn't be the safety of the driver,
the passengers in the car, or the other vehicles on the road.
—William C. Gilmartin, CPCU, ARM, Senior Vice President
Riggs, Counselman, Michaels And Downes, Inc., Baltimore, MD
- While I am quite a fan of the cell phone, I firmly believe that its
overuse will lead to catastrophic results. I believe that a prudent company
will set a policy that includes firm limitations on the use of cell phones
by its employees. Such limitations should include the following rules:
(1) No use while driving in traffic. While there are situations when
cell phone usage while driving may be acceptable, such as interstate highway
driving in rural areas, usage in city traffic, even in traffic in smaller
towns is simply an accident waiting to happen. Usage in town should be limited
to usage while the vehicle is not moving, i.e., in a parking lot. Probably
the best solution would be to prohibit usage while driving. If a cell call
comes into an employee while driving alone, the employee should advise the
caller to hold for one moment while the driver finds a place to safely park
the vehicle. If the driver is in intense traffic, then they should either
turn off the phone, or simply not answer the phone. Companies may want to
include cellular voice mail for those employees with company cell phones.
(2) No use while operating any type of machinery or equipment. The implications
of cell phone usage while operating any type of mobile equipment or industrial
machinery seem all too obvious. With the low monthly cost of cell service,
and the subsequent proliferation of usage by people of all social and economic
strata, blue-collar usage at work must not be overlooked.
(3) Rules regarding cell phone usage while at work should include both
company use of cell phones AND personal use. The rules should address use
of company owned cell phones and personally owned cell phones. All employees
should be advised in writing of the rules, and should even "sign off" on
the rules.
—L. Bryan Williams, CPCU, AAI, President
Combined Services, Inc. (CSI Insurance Brokers)
- Our fleet manual contains the following section on cell phone use.
"All drivers are reminded to use cellular telephones carefully while
operating a vehicle; studies have shown that using cell phones while driving
significantly increases the risk of being in an accident. If possible, pull
off the road before initiating a cell phone call from your vehicle. If it
is not possible to first pull off the road, keep all calls as short as possible
and avoid allowing the phone conversation to distract you from traffic conditions,
your driving, and other drivers. Use of cell phones which permit hands-free
operation is recommended."
We did consider banning cell phone use while operating company-owned
vehicles, but realized that we had no way to enforce such a ban. There was
also a lot of discussion about other distracting behavior (adjusting radio,
eating, etc.), which also increase the likelihood of an accident. The above
provision was therefore a compromise.
—M. Lyn Martin, CPCU, ARM, Are, Corporate Risk Manager
California Casualty Management Co.
- Our largest exposure results from the use of cell phones while driving.
We've just developed a formal Driving Safety Policy and have used the Prohibited
Actions section of the Policy to prohibit use of a cell phone while the
vehicle is in motion. Failure to comply with any section of the Driving
Policy may result in corrective action up to and including termination.
Employees are required to sign an acknowledgement that they have received
the Policy and agree to comply with its terms and conditions. While we don't
believe this will eliminate the problem, our goal was to address the issue
and reduce the frequency.
—Jean Bullerwell, Sr. Risk & Insurance Analyst
Getronics, Billerica, MA
- I am the risk manager for New York State. Our governor recently issued
an executive order banning the use of hand held cell phones for all State
employees, while conducting business in a vehicle.
—Rosemary Keville, Chief
New York Bureau of Risk & Insurance Management, Albany, NY
- Companies can have the same kinds of polices on cell phones, but people
will do what they want, because they believe they are "more careful" than
the person in the car on the phone next to them. I think its called human
nature.
—Dennis Wilder
IRMI Update is sent to subscribers by plain text e-mail twice each month.
To initiate your free subscription, use the e-mail registration
form.