2015 STS - Minimize Your Losses

MINIMIZE YOUR LOSSES

Presented By:Dave WittwerHays Companies

Kent MillerSafety, Claims and Litigation Services, Inc.

Importance of minimizing your losses1. More venues are becoming more adverse to the transportation

industry2. Settlements and jury awards are increasing3. Keeping your employees safe and on the job4. Lost revenue – direct and indirect costs5. Insurance costs

MINIMIZING YOUR LOSSES


12.8%

12.7%

11.7%

10.2%

9.4%

43.2%

SPRAIN/STRAIN-LIFTING

FALL/SLIP-SAME LEVEL

FALL/SLIP-DIFFERENT LEVEL

MOTOR VEHICLE ACCIDENT

SPRAIN/STRAIN PUSH/PULL

ALL OTHER CLAIMS

Percentage of Top 6 WC Claims by Type

15.9%

13.8%

12.6%

11.1%

10.1%

36.6%

BACKING

TURNING

LANE CHANGE/MERGE

REAR END

STRUCK BY OV

ALL OTHER CLAIMS

Percentage of Top 6 AL Claims by Type

Accidents just don’t occur, they happen due to some type of unsafe event. The difference between companies is how they identify hazardous conditions

and risky behavior; and then what actions they take to correct it.

Do you have a loss history like this? Is your frequency numbers higher or smaller than your competitor?


YEARLY

ACCIDENT

COSTS

PROFIT MARGIN

1% 2% 3% 4% 5%

$1,000

5,000

10,000

25,000

50,000

100,000

150,000

200,000

100,000

500,000

1,000,000

2,500,000

5,000,000

10,000,000

15,000,000

20,000,000

50,000

250,000

500,000

1,250,000

2,500,000

5,000,000

7,500,000

10,000,000

33,000

167,000

333,000

833,000

1,667,000

3,333,000

5,000,000

6,666,000

25,000

125,000

250,000

625,000

1,250,000

2,500,000

3,750,000

5,000,000

20,000

100,000

200,000

500,000

1,000,000

2,000,000

3,000,000

4,000,000

REVENUE REQUIRED TO COVER LOSSES

Losses are costly and affect the entire company

Why do losses occur?They occur as result of Unsafe Actions and/or Unsafe Conditions

Unsafe Actions1. Inappropriate safety action taken or decision made2. No safety action taken or decision made3. Inability to take safe action or make appropriate decision

Unsafe Conditions1. Unidentified hazards2. Inappropriate action taken3. No action taken4. Inability to take action


Unsafe Actions can include:1. Working without using available PPE2. Working on equipment without prior training3. Driving while ill or fatigued


Unsafe Conditions can include:1. Poorly maintained equipment2. No PPE or defective PPE3. Poor housekeeping4. Purchase of equipment that creates a hazard


How do you minimize losses?

A company minimizes losses by identifying and managing unsafe acts and unsafe conditions through the

implementation of effective Risk Management Practices



Controlling Losses

IdentifyingExposures and

Hazards

Review and Assessment of

Losses

Depends upon

Controlling Risk(Mitigate, Eliminate, Transfer)

Results in

What is RISK, Exposure and Hazards?

The Merriam-Webster Dictionary defines these terms as: Risk: (1) “Possibility of loss or injury”(2) “Someone or something that creates or suggests a hazard”

Exposure:“The condition of being at financial risk of financial loss”

Hazard:“Source of danger”


Identifying Exposures and Hazards


Comprehensive and continuous assessment of your operational and safety programs is very important to minimizing loss. 1. Review your safety culture

a) Do you have a culture where safety is valued by all employees?b) Do you have Corporate safety objectives and upper management involvement?c) Are safety roles and responsibilities at all levels clearly defined?d) Is safety valued at your company?

2. Review your policies and procedures3. Review your operational hazards

a) Loading and unloading processes – freight, rigging, equipmentb) Load planning – permitted loads, dead head c) Pilot car – company and 3rd party contractors

4. Review your employment practicesa) Hiring standardsb) Hiring assessments

5. Review your compliance programsa) FMCSA, OSHA, EPA



6. Review your training programsa) Orientation, remedial and recurrent

7. Review your inside and outside physical exposuresa) Trip and fall hazardsb) OSHA compliance items, PPE, electrical, ladders, HM

8. Review your equipment and processesa) Trucks, trailers, cranes, powered industrial trucks, gantry systemsb) Securement devicesc) Rigging equipmentd) Pilot car equipmente) Inspections, scheduled maintenance and handling of repairs

9. Review your claims handlinga) Reporting, claim handlingb) RTWc) Remedial training

10. Review your employee management systemsa) Supervision, managementb) Performance monitoring

13

Don’t let your property be the cause of your next claim.

Tool to reduce the possibility of injury or

cause injury

Creating a good working environment?

Building a culture where safety is valued?



Always keep in mind - RISK management is about managing the possibility of loss or hazard.

Make comprehensive assessments and observations often and get help from your employees by creating a safety culture where safety is valued and all employees feel they can report unsafe acts or conditions.

Systematic Approach to Safety


Your safety programs must take into account the relationship of who, what, when, where and why. A systematic approach will help you look at your programs from a cause/effect

and safety relation standpoint. The driver who you hire affects how effective your operational process is and how well he operates your equipment or inspects it and how

he makes decisions about interacting with his environment changes.

Environment

Processes Personnel

Equipment


Review and Assessment of Losses

It is important to understand why a loss occurred so future losses can be prevented. Steps to mitigate loss exposure include:1. Conduct a thorough accident investigation

a) Review the scene of the injury or accidentb) Interview your employeec) Collect information and datad) Create a timeline of events

2. Review the claim from a prevention stand point, not fault3. Conduct a root cause analysis – know the difference between direct cause,

surface causation factors (contributing causes) and root cause4. Review with a claims committee5. Develop and implement corrective actions6. Monitor and assess improvements


Direct Cause – The driver suffered a broken arm when the truck crashed into the tail end of a car.

Surface Causes – The truck crashed into the car because the driver was inattentive or distracted.

Root Causes – The driver was distracted because he was on the phone resolving an issue with his pay.

Root Cause Analysis


Surface Causes

Unsafe Conditions Unsafe Acts (behavior)Hazard Failure to enforceLack of Time Creates hazardFailure to communicate Fails to identify hazardBroken equipment Disregards policyUntrained employee Does not inspectTo much work Works unsafe/cut corners

Root Cause Analysis


Root CausesNo or inadequate trainingNo policy or out dated policyNo procedures or outdatedNo job hazard analysisNo management controlsRoute planning w/out safety considerationsNo accountabilityNo regard for safety

Root Cause Analysis


Implement a Continuous RISK Assessment Program that includes

A quality control/review process

Tip to Minimizing Your Losses


Safety Programs FAIL When –COMPROMISES are taken


Companies cannot look at safety as something we have to do. They need to value safety and move it

to the top of their priority list. Building and maintaining a good safety culture is the backbone

to any safety program.




Questions?

Education

2015 STS - Minimize Your Losses