A survey recently conducted by The Hartford revealed that only 62 percent of a nationally representative group of 610 employed adults knew that medical costs related to an on-the-job injury would usually be covered by workers compensation. Amazingly, about 15 percent of the surveyed workers even expect to receive little or no pay while out of work recovering from an injury.

This reminds me of when, in my former career as a consultant, a client questioned whether he should tell his employees about their workers compensation coverage. He was afraid they would use it if he told them about it!

Contrary to his fear, it is just such lack of knowledge and distrust of the system that leads to attorney involvement and unnecessarily high loss costs. Obviously, neither businesses nor the insurance industry has done an adequate job educating employees about their rights to workers compensation benefits if they are injured.

If this is true of your company, or your clients' firms, consider formulating and executing a plan to bring your employees up to speed. The Hartford suggests taking these steps:

Establish a company return-to-work team
Choose a claim administrator with a return-to-work orientation
Communicate return-to-work as an employee benefit
Assess the tasks each job requires
Identify alternate or modified work
Report all injuries promptly to the supervisor so that the claim can be handled and the worker's treatment begun quickly
Maintain ongoing communication with an injured worker at home
Return the worker to the same job or modified work in the same department or a different position in the same company—depending on the medical condition of the employee.

So what do you think? Has our industry done a poor job communicating with employees about workers compensation? What additional steps should employers—or the industry—take to educate employees about workers compensation? Do you have a success story you can share? [See reader comments.]

Have a great day!

Jack

Jack P. Gibson
President
IRMI

Sponsor News from Zero Risk

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Risk Tip

Monitor Air Quality To Avoid Sick Building Syndrome Claims. Sick building syndrome (when something is in a building that makes occupants sick) is problematic because you generally can't tell you're vulnerable until it strikes. The only defense against it is information—about how the building is operating and how its operations are affecting the air quality in the building. With this information, building operators can diagnose the likely source of poor quality air. Perhaps it is a faulty air duct fan or odors and gasses emanating from new furniture. By focusing on a problem, the HVAC advisor can recommend remediation. By measuring the air quality before and after changes, the building owner can know if the problem has been corrected—before paying for the work.

There are several ways to monitor indoor air quality. One method employs an industrial hygienist who comes to the building and, over a few hours or days, takes samples using hand-held equipment. The report, usually available in a month or so, will provide a scientific explanation in great detail of the air quality in the space at the time of testing. This method has merit when a sudden change is detected in the building (often creating a problem) and a detailed analysis is desired.

Another method employs continuous monitoring with remote data transmission. With this method, electronic sensors are permanently installed in a building. The information about the air quality is continually gathered, without human intervention, and is transmitted via the Internet to the building manager or agent. The permanent record can be used to discover trends in air quality, which will indicate both location and intensity of air quality problems. Such data, for example, can indicate the presence or absence of the conditions in which mold can thrive and act as an early warning system for preventative action to be taken. This method is valuable for those situations in which the building owner is willing to be proactive and wants long-term protection from potential indoor air quality problems.

With either method, the common element is the gathering of information in a timely manner and in such a way that the proper preventative or restorative actions can be taken before the indoor air quality problems become prohibitively expensive.

By: Jim Doudiet
PureChoice Inc.
Lakeville, 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 Jim.

New Expert Commentary

There are now 336 articles on IRMI.com, and many more are in production. Below you'll find summaries of some recent additions with links to the articles.

Late Notice In Reinsurance Claims: Does Prejudice Matter?—The law of late notice in reinsurance varies from state to state. Here, Larry Schiffer briefly explores the late notice defense to payment under a reinsurance contract.
Practical ERM Applications: Assessing Capital Adequacy—The first step in effective capital management is the assessment of the capital necessary to run the enterprise. Jerry Miccolis outlines a process for assessing capital adequacy.
Achieving Cost Reductions through Workers Compensation Reform—Mick McGavin provides a list of issues that employers should consider when there is an opportunity to reform their state’s workers compensation system.
Estimating Earthquake Loss In The Midwest—In this article, Nathan Gould discusses how new ground motion maps and the genesis of the damage curves may impact the estimate of earthquake loss in the Midwest.

New IRMI Insights

The IRMI Hard Market Survival Guide 2002—IRMI Research Analysts provide 20 tips on how to survive the current hard property and casualty insurance market.

IRMI Construction Risk Conference

Don't Miss the Technology Showcase!—This is a wonderful opportunity to learn about technology that is revolutionizing risk management programs to be held Tuesday and Wednesday during the Conference. Four cutting-edge technology companies will be featured:

ConfirmNet (certificates of insurance, issuance and tracking solutions)
Computer Sciences Corp. (property/casualty software)
Computer Risk Management (WC, auto, GL, property claims program)
Georgia-Pacific (mold and fire resistant products)

If you are interested in participating in the 23rd IRMI Construction Risk Conference Technology Showcase in Chicago in 2003, please contact Paul Murray at (800) 827-4242, ext. 313, or contact us. See the agenda to learn more about other conference sessions.

Complete the online registration form to register.

IRMI Products & Services

New Edition of 101 Ways To Cut Insurance Costs Now Available —The third edition of 101 Ways To Cut Business Insurance Costs without Sacrificing Protection is a virtual how-to guide of cost-cutting strategies for every major line of coverage. Coauthor Jack Gibson says, "The substantial premium hikes everyone is now seeing on their renewals has revived the need for active management of insurance costs, and this book gives insurance buyers the practical advice and information they need to once again take charge of their insurance destiny." Available for only $34.95, it will save you much, much more on your next renewal—even in this hard market.

Training and Continuing Education

New Fiduciary CE Course from IRMI & Web-CE—IRMI and Web-CE have developed a new continuing education course: IRMI on Fiduciary Liability. This course has been approved for property-casualty continuing education credit in Alaska, Arkansas, Delaware, Georgia, Idaho, Illinois, Kansas, Maine, Michigan, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Washington, and Wyoming, with more states in the works. This course will teach you the ins and outs of fiduciary liability insurance, who and what is covered, excluded, and how coverage applies—as well as providing you with valuable CE credit for under $50. To learn more about this course and others offered by IRMI and Web-CE, see the website.

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IRMI Update—Issue #49

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