Posts Tagged ‘anniversaries’

Outlook for Workers Comp: Centennial in a Storm

Tuesday, August 23rd, 2011

In this summer of weather extremes, workers comp is celebrating its 100th birthday in America. The weather forecast – along with the prognosis for workers comp – probably sound familiar: periodic storms, heavy rain, damaging winds. The National Council on Compensation Insurance (NCCI) has issued its “state of the line” report for workers comp: 2010 was a tough year and the outlook for 2011 carries a severe weather warning.
The key indicator for insurance health is the combined ratio: add up the accumulated losses and the expenses, subtract investment income and hope you end up somewhere around 1.0. The combined ratio for 2010 went up to 1.15, five points above the previous year. Despite improved returns on investment (otherwise known as the “jobless” recovery), pretax losses for the industry averaged one percent – the first such loss since 2001.
Insurers are suffering from a convergence of negative factors: poor underwriting results, a drop in premiums (due to reduced payrolls), and an increase in claims frequency, which is perhaps the most alarming trend of all. For a number of years the increase in severity (the average size of claims) has been balanced by a decrease in frequency. If frequency continues to trend upward, the warning flags for severe trouble will be flapping in a very stiff breeze.
Politics as Usual
Further complicating matters for insurers, state level politicians are single minded in their effort to keep the costs of comp insurance as low as possible. As part of their relentless struggle to stay competitive, state regulators are reluctant to increase rates. NCCI has applied for rate increases in 14 of the states which they directly manage, up from eight in the previous cycle. Any move toward higher rates may signal at least the beginning of the long-awaited end of the soft market that has endured for over a decade.
Finally, there has been a lot of turnover among the state officials who regulate workers comp: there are 24 new insurance commissioners across the country. As NCCI puts it:

The number of newly elected and appointed officials means that the industry will face a challenge in terms of education and information for next few months at least.

Time to polish up the Gucci’s? The insurance industry hardly needs to crank up the lobbying apparatus – it’s always operating full tilt.
Candles in the Wind
As workers comp turns 100, we note that longevity itself is not cause for celebration. Just as it’s no fun to grow old, it’s not much fun trying to make money in workers comp these days. Despite a decade of tightened eligibility requirements and cuts (some draconian) in benefits, we have seen a continued deterioration in the financial health of comp carriers. Perhaps it’s my imagination, but I seem to detect a tone of anxiety as stakeholders gather to sing “Happy Birthday” to Workers Comp in America. The flames of the candles falter in the midst of a raging storm.

Celebrating a century of safety with ASSE

Tuesday, April 26th, 2011

Kudos to the American Society of Safety Engineers (ASSE), whose 32,000 members will be celebrating the organization’s 100 year mark during the annual North American Occupational Health & safety Week (or NAOSH week, for short), which runs from May 1 to May 7. Annually, ASSE teams up with the Canadian Society of Safety Engineering (CSSE) in the first week of May to raise public awareness about safety.
Here’s a few of the resources that are available
NAOSH Week Toolkit
Safety Through the Decades chart
May 4 – Occupational Health and Safety Professional Day
ASSE’s 100th Anniversary

ASSE’s 100th Anniversary from jon schwerman on Vimeo.

Remembering Katrina

Monday, August 30th, 2010

If you haven’t discovered the gem that is the Boston Globe’s “Big Picture” yet, you are missing a wonderful feature. Billed as “news stories in photographs” it is a themed news essay curated by Alan Taylor. From the BP oil disaster to the floods in Pakistan, the photos add a visual narrative to breaking stories of the day.
This past week, as in many media outlets, the focus was on Katrina. With a human toll of more than 1,800 dead and an economic toll exceeding $80 billion, the 5-year anniversary merits our attention.
For many of us, the anniversary is a look back, but for many of those who experienced it first hand, Katrina is a continuing nightmare. News reports point to ongoing health problems, from mental health issues to general health problems, such as skin infections and respiratory illnesses: “A recent study published in a special issue of Environmental Toxicology and Chemistry found elevated concentrations of lead, arsenic and other toxic chemicals were present throughout New Orleans, particularly in the poorer areas of the city. It suggested that widespread cleanup efforts and demolition had stirred up airborne toxins known to cause adverse health effects.”
Many residents, particularly children, are still still experiencing severe emotional and psychological disturbances. The National Center for Disaster Preparedness at Columbia University’s Mailman School of Public Health has been conducting studies on Gulf coast residents, and recently issued a white paper in coordination with the Children’s Health Fund:

“Together, these documents indicate that although considerable progress has been made in rebuilding the local economy and infrastructure, there is still an alarming level of psychological distress and housing instability. Investigators believe that housing and community instability and the uncertainty of recovery undermine family resilience and the emotional health of children. These factors characterize what researchers are calling a failed recovery for the Gulf region’s most vulnerable population: economically disadvantaged children whose families remain displaced.”

Looking back to look ahead
It’s no mystery why FEMA would designate September as National Preparedness Month. Between the man-made disaster of 9-11 and nature’s twin-wallop of Katrina and Rita, it’s certainly been a month fraught with peril, at least in terms of the last decade. In particular, FEMA is calling on businesses to be ready with disaster plans, and offers resources for that purpose.
A crisis by its very nature is unpredictable and random. But from a risk management point of view, it’s important for businesses to examine past events so that lessons learned can become part of planning for future crises with an eye to minimizing losses and disruption.
Perhaps one of the best articles we’ve seen on this theme is Crisis Management of Human Resources: Lessons From Hurricanes Katrina and Rita. This article discusses the three phases of crisis management: planning and preparation; immediate event response; and post crisis, or recovery. It cites specific companies and the way they problem-solved aspects of the Katrina crisis, and points to the importance of putting some plans in place: having and circulating an alternative emergency communication systems plan; keeping contact information and next-of-kin data current; maintaining communications with employees during an emergency; having updated policies and procedures for compensation and benefit continuation; making resources such as EAP services available to employees; and having flexible and alternative work arrangements.