International Door & Operator Industry

NOV-DEC 2015

Garage door industry magazine for garage door dealers, garage door manufacturers, garage door distributors, garage door installers, loading docks, garage door operators and openers, gates, and tools for the door industry.

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Page 65 of 128

V O L U M E 4 8 I S S U E 6 D E C E M B E R 2 0 1 5 63 ASSOCIATIONNEWS By Gordon Celliers and Andrew Stergiou Loss Control is a very important aspect for all contractors including IDA members. Loss control and safety programs have become a way of life and are essential to the well being of the company's costs and its most valuable asset – its employees! Increased regulations, worker awareness, and a potential reduction in employer cost have made safety management a high priority in recent years. Here are some accident facts developed from a study of the losses for 50 door companies: • 45% of the Workers' Compensation losses occurred to employees with one year or less experience working for their current company. • The cost for those employee injuries represented 48% of all money paid out for Workers' Compensation injuries. • Temporary Total Disability injuries (accidents where the employee was considered temporarily disabled and not able to work at their job during the recovery period) represented 65% of the total number of accidents and 99% of the total cost paid to employees as a result of the accidents. • Mondays represent the day of the week with the highest number and cost of accidents (32% of the accidents and 47% of the cost of accidents) • The longer you take to report a Workers' Compensation claim, the higher, generally, the cost will be. Based on an actuarial study of 53,000 claims done by Hartford Insurance Company, the following increases in cost as a result of late reporting were developed: So what do we do with these facts, and what actions can be taken to change these statistics and potentially reduce the number of claims and the cost of claims? Also, how does a business beneft by reducing its claims costs, and isn't that the reason for workers' compensation insurance in the frst place - to take care of those costs? The fnancial beneft from reducing the number and cost of accidents comes from the fact that workers compensation policies are priced based on four years of prior experience. A factor (EMF – experience modifcation factor) is applied in the premium calculation, which either increases or decreases the premium based on the insured's own prior loss performance. Losses which occur in one year impact premiums for four years because of the four year averaging process. The other way accidents impact business costs and their bottom line is through reductions in productivity, which happen when employees are taken away from the job to go for medical treatment, which results in using another employee for treatment, cause a job to have to be rescheduled, impact deliveries, etc. Actions Which Can be Taken to Reduce Losses Based on some of the facts which were described earlier here are some ideas to consider: • If a high percentage of losses are occurring to new employees (employees with one year or less experience), o Consider actions which will reduce turnover (and as a result reduce the number of employees in the segment of individuals with one year or less of employment). Look at wages versus the competition. Lag Time Average settlement value of claims 2 weeks over DOI + 18% 3rd & 4th weeks after DOI + 30% > 4 weeks after DOI + 45% Continued on page 64

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