Effective Ways To Reduce Workers' Compensation Claims And Related Costs

By Author: Nate Rodney
Total Articles: 499
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Workers' compensation insurance safeguards the employees, injured in the course of employment. In many states of US, it is a mandatory policy and is required by every company with employees.

Despite of all the preventive measures, instances of workplace injuries are increasing every year, forcing the business owners to spend huge amounts on compensation claims. According to U.S. Bureau of Labor Statistics (BLS), nearly 3.1 million non-fatal workplace injuries and illnesses were reported among private industry employers in 2010.

Hence, it is necessary for every employer to implement effective safety measures, not only to reduce compensation claims, but also to improve workplace safety and employee security.

Employing a comprehensive program, tailored to suit the organization's specific needs and goals, helps the organization decrease the frequency as well as the severity of injuries at workplace. Following are few ways that can help you in establishing a risk free workplace, which further aid in reducing workers' compensation claims and related costs.

Implement risk controlling measures
Employees ...
... working in industries, manufacturing plants, construction sites, etc., are often prone to on-job injuries and accidents. Working with heavy equipment using hazardous material raises employee safety concerns. Hence, every employer needs to follow a series of steps to improve workplace safety. These steps include - risk identification, risk assessment and risk control.

Risk identification is identifying the possible hazard/risk. A hazard is anything that could hurt the employee or any other third party. For example, damaged or frayed electric cables are potential sources of accidents at workplaces.

Risk assessment involves finding of all the potential outcomes of identified risks/hazards and the seriousness of the damage they could cause. In the above mentioned example, frayed electric cables, the harm could be an electrical shock.

Risk control is nothing but fixing the hazards. The employer should eliminate the hazard; if not, should at least try to make hazards less dangerous. Replacing the damaged electric cords with new ones is one of the risk control measures to avoid electrical shocks.

Risk controlling measures vary according to the nature of the vulnerabilities. However, effectiveness of any step lies in proper review and implementation of safety measures on a regular basis.

Provide safety training to the employees
The next best way to reduce workplace injuries is by emphasizing on-job safety during training. Provide safety training to all the employees about safe handling of equipment, possible risks in the workplace, company safety rules and procedures, emergency procedures (usage of fire extinguishers, etc.), importance of personal protective equipment required on the job, etc. This kind of training helps employees acquire all the skills and knowledge required to be safe in the job location.

For instance, if a worker's job involves working with sharp objects like broken glass, rusty metals, etc., his potential risks would be cuts and punctures on the skin. These risks could be avoided by providing hand gloves, and by offering an effective training on how to handle such things safely.

Be aware of the fraudulent claims
Insurance fraud occurs when the employees purposely provide some false information to receive the benefits of the claim. According to the Coalition Against Insurance Fraud, insurance fraud costs consumers, employers and insurance carriers at least $80 billion each and every year. Among which, worker’s compensation insurance fraud alone accounts for a considerable percentage.

Use efficient software to track claim costs
Automating and tracking your workers' compensation claims process is another best way to reduce claim costs. Using effective claims management software eases your work as well as makes the process more accurate. With the help of such software you can instantly see all the expenses by the employee, type of injury, etc. It thus helps you save time and money besides taking control of your workers' compensation claims.

A comprehensive workers' compensation program always helps your organization do much more than simply saving the claim costs. It makes your workplace safer, secures employees and finally saves your organization from fraudulent claims.

JDi Data Corporation has provided insurance claims software since 1992. JDi Data offers web based workers compensation software and also claims systems for insurance claims departments, third party administrators and risk managers to administer property, casualty and general liability claims. JDi Data has built a reputation in quality claims management software with special emphasis on specialty lines and complex litigation.