Some thoughts on whether being "average" is good enough…
What does it cost to buy a bad car? For example, one that will break down 25% more than others. One that will be in more accidents. The “cost” is not the purchase price but the incidental costs of not having a good car.
A good plan for dealing with workers comp is measured by what you don’t see or hear. An accident that didn’t occur leaves little evidence of its non-existence. A person who never left work saves enormous replacement costs, but how do you enter that on the books? (WCxKit)
Measuring work comp, therefore, is almost always done by measuring actual damage. A “good” result is having average amounts of damage. Few operations will commit substantial effort to improving much beyond “average” results even though a small additional effort might put a company in the top 5% of employers.
If a company insists on measuring with a yardstick of negative results, it is worth noting that comp costs worse than average are the best indicator that a business is heading toward catastrophic failure.
Comp costs measure more than accidents. They measure morale, leadership, hiring practices, attention to detail, ability to cope with stress and ability to learn from mistakes.
A proactive, imaginative workers comp program undertaken while comp costs seem to be “average” produce unexpected, positive results throughout a company.
Two areas where improvement can be achieved at little cost are:
1. Better reporting and early sharing of accident information. (WCxKit)
2. Better coordination of comp claims with group medical and STD benefits.
Any executive team that thinks “average” is a good goal should be aware: The Titanic carried more lifeboats than were legally required. It was above “average.”
When purchasing insurance-related products, such as claims handling, keep this in mind.
Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, New York. He is a frequent writer and speaker and has represented employers in the areas of workers compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Contact Attorney Ronca at 631-722-2100.
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