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:
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 website. 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
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