Insurance companies who provide workers compensation insurance will typically conduct some type of safety inspection at the employers workplace after the policy is in place. Let’s talk about the real reason they do this and how an employer can benefit!
To begin, don’t be fooled that an inspection conducted by an insurance company is done solely for the benefit of the policyholder! Are there some benefits for the employer? Sure. But regardless of how an employer may feel about this “service,” it’s primary function is to benefit the insurance company, to get a better look into the operational exposures and risk hazards present in the employers workplace and to relay that information back to the insurance company underwriting department for review.
Most insurance companies provide this type of “service” free to their policyholder. And most of the time inspections are conducted by a third party hired by the insurance company. Don’t be surprised if it’s the same organization they hire to conduct audits.
In addition most states now require insurance companies who provide workers comp in their state to offer employers safety services when requested. That’s right, they are required to provide these services when an employer asks for help.
Now with all that said how can a safety inspection help a policyholder? In one word, CLAIMS! I often write about the effect workers compensation claims can have on an employer so it shouldn’t be too hard for you to find more information about claims and premium right here in this blog. For an experience rated employer the reduction of claims will not only translate to lower premium but will help provide a safer workplace for employees, keeping them safe from harm and on the job.
If an employer is willing to listen to and accept outside imput from a safety inspector they should learn:
- About previously unknown risk exposures and hazards present in their workplace and how to correct them for the safety of their employees.
- Previously unknown safety requirements placed on them by government authorities such as OSHA and others and possibly avoid fines levied on them by these organizations.
- How to develop and maintain a safe workplace by identification of safety exposures and implementation of safety controls.
- How to analyze past workers comp claims and identify areas of improvement.
- How a reduction in claims will have a positive impact on the premium they pay!
How does an insurance company benefit? For an insurance company the benefit comes in the development of a more profitable policyholder. That’s not meant as a slam! Insurance companies must be able to make a profit in order to continue providing coverage so the profit motive is an important part. After all they are in business, just like all of us, to make money, pay their employees and be able to continue to provide services! And if some of the services they provide can help a policyholder reduce or eliminate claims, keep employees safe and reduce premiums the policyholder has to pay, what’s wrong with that?
Hope this helps you out! Thanks!
