All businesses in the U.S. textile care industry must carry workers’ compensation insurance, allowing employees to be reimbursed for lost work time and/or medical bills when they have been injured on the job. Fees and required coverage are set by each state; however, businesses can help decrease their premium costs by keeping a few strategies in mind.
Experience Modifier Explained
The premiums paid by businesses are determined by the carrier’s rate, multiplied by the company’s Experience Modifier, sometimes called an E-Mod, which essentially gives an easy reference for how the company is performing in terms of safety compared to other businesses in the same industry. An E-Mod of 1.0 is the baseline average, with anything below 1.0 creating a discount in premium and above 1.0 increasing the premium.
Carrier rates will vary between companies, but what is included by the carrier could affect the business’ E-Mod, thereby making some policies that seem more expensive initially, more affordable overall. Three years of company safety reports are used to determine E-Mod, as well as what additional efforts are in place to prevent employee injuries.
Decrease Injuries to Decrease Your E-Mod
Many facilities have safety committees that can help focus efforts at decreasing injuries, but management should ensure the following points are addressed by those committees.
Update your PPE
Personal Protective Equipment (PPE) is crucial in preventing the spread of infectious diseases and bloodborne pathogens in a laundry facility, but if employees aren’t using PPE, or are using it incorrectly, injuries could occur. Uncomfortable or restrictive PPE is unlikely to be used.
“It is human nature that we want to look stylish,” said Cathy Bacher, Loss Control Consultant with Acuity Insurance. “It may sound silly, but offering eye protection, gloves, etc., in different colors and styles makes workers want to actually use them. And new technology increases the effectiveness, such as no-fog goggles and breathable fabrics.”
Create or Utilize Training Programs
Safety training is required by OSHA, but ensuring safety programs are in place and adhered to can decrease injuries, as well as premium costs. Not only will you avoid fines from OSHA, but having appropriate safety education creates a safe workplace.
“OSHA will fine companies if they find employees are not adequately trained,” said Bacher. “Many insurance carriers, Acuity included, provide materials on their website so you can easily ensure compliance with safety regulations.”
Walk the Walk
Managers and supervisors should be performing a daily walk through and safety inspection. They can solve safety issues by simply walking through the facility at least once per shift, spotting potentially dangerous situations for their employees. Extension cords stretched across walkways, spilled liquids, and other items that are being overlooked by those busy with their tasks can all lead to injuries and additional costs for the business.
Talk the Talk
Walking through isn’t enough. Members of management should also make an effort to talk with their crews.
“I always tell people to ‘look for the duct tape’,” says Bacher. “Employees are ingenious at fixing problems. If a manager notices duct tape covering part of a chair seat, for example, and stops to talk to the employee using that seat, they may discover the duct tape is preventing a piece of metal or plastic from poking through to the employee’s leg. That could be a safety hazard, later causing a claim. It is more cost effective to replace the chair than to have a workers’ comp claim for an injury due to the faulty chair.”
Other Methods of Lowering Your E-Mod
Nurse Triage Programs
Many insurance carriers have nurse triage programs as part of their services to their clients. These programs allow employees to get virtual, effective assistance with injuries without accruing extraneous fees.
“For non-emergency injuries, such as a sprained ankle, you don’t want to go to the emergency room, because it would cost thousands, rather than going to a walk-in clinic, which may only be a couple hundred dollars,” said Joseph Timmerman, Senior Commercial Underwriting Consultant with Acuity Insurance. “Acuity’s nurse triage program gives employees an opportunity to ask medical advice from a professional before even entering a medical facility. It’s not only the quantity of incidents that factors into your E-Mod, but the total dollar amount as well. You want to be sure your employees are taken care of, but not visiting the emergency room unnecessarily.”
Return to Work Programs
When an employee is injured, even if they cannot return to work at 100%, by allowing them to return for part-time or modified work will help decrease overall workers’ compensation costs.
“In the calculation, if employees don’t have to miss significant time from work, those claims get discounted,” said Timmerman. “Having employees able to continue working and keeping losses strictly medical helps keep the E-Mod down, therefore decreasing your premium.”
Some states sponsor programs to improve safety that allow discounted coverage rates if the business participates in or is accredited by a program. For example, Drug-Free Workplace Programs. Your workers’ compensation insurance representative can determine what programs are available for your workplace.
ALM would like to thank the representatives of Acuity Insurance who assisted with this post.
Acuity Insurance, headquartered in Sheboygan, Wisconsin, protects over 100,000 businesses across 26 states. They insure a wide range of service-related businesses, including auto repair shops, hotels and motels, rental properties, and much more. Their broad, flexible policies, including Services Bis-Pak (Businessowners), are delivered through a network of independent agents, and they offer a wide range of coverages for services businesses, including several professional liability coverages, garagekeepers, broad-form products, printers’ E&O, and liability for guests’ property. Acuity is active in service business associations across the country and continually works to enhance the products and services they offer.
Rated A+ by both A.M. Best and Standard & Poor's for financial strength, Acuity earns a 96% claims satisfaction rating from customers. Acuity employs nearly 1,300 people and is named the top employer in insurance. For more information on Acuity, visit their website, or find them on Facebook, Twitter, YouTube, or LinkedIn.