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Improving Safety, Controlling Insurance Costs
If the
rate hike in your recent insurance renewal hit you as hard as it did most
contractors, you are probably looking for ideas on how to control your
insurance costs.
One way is to improve your safety record.
Don’t expect to hold the line. Insurance experts say that rates for
contractors with average or better safety records are rising from 25 percent
to 50 percent.
But those at the other end of the scale — companies with a rating between
poor and bad — are having a tough time finding any insurance and are seeing
increases of 100 percent to 200 percent when they do find it.
A Good EMR
Insurance companies evaluate your safety record with a risk measure called
the experience modification rate (EMR).
Your EMR reflects the frequency and severity of injuries, using a score of 1
to represent the industry average. The farther below 1 you can move your EMR,
the better off you are. Conversely, as your score creeps above 1, you are
going to see your insurance rates soar.
If you hit 2, you are going to be socked hard; if you can get down to .5,
insurers are likely to offer you their best rates.
Built-In Dangers
Construction work is dangerous by nature.
The U.S. Bureau of Labor Statistics reported 1,154 on-the-job deaths in
construction during 2000. Nearly half of those fatalities resulted from
falls. Another third of those who died were electrocuted.
In addition to the deaths, 503,500 construction workers suffered injuries
serious enough to need medical attention in 2000.
Training, Equipment
Training is at the heart of any safety effort. Proper equipment is another
key component.
On site and online, classes and safety demonstrations keep accident
prevention on the minds of your workers. To keep interest high, consider
offering a pay bonus for good safety records.
Possible instruction topics include proper lifting techniques, fall
prevention, safe handling of chemicals, power-line hazard analysis, and
trench danger assessment. Effective training must take into account any
special language needs of your work force.
Make sure that the size of personal protective clothing and equipment is
appropriate for your employees.
Housekeeping
Site housekeeping provides another opportunity to improve safety. An orderly
work site, in which workers know what to expect when they take a step, can go
a long way in preventing accidents.
Better safety performance can help improve more than your insurance rates.
With fewer accidents, more work gets done, so productivity rises and you have
a better shot at staying on schedule. You can also expect to see a boost in
employee morale and an enhanced community reputation.
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