Opinion: Five Steps to Reducing the Costs of Loss
b>By John Liberatore
i>President
arom Data
“Efficiency” may be overused as a management buzz word. But from a risk-management perspective, we can learn from companies like Southwest when it comes to reducing, often substantially, the cost of driver injuries or vehicular accidents involving third parties.
o reduce commercial auto and workers’ compensation costs significantly, a fleet must first examine its internal post-loss processes. From the moment an “event” occurs until its resolution — denial or settlement — every facet can and should be studied from the standpoint of gaining efficiencies and improving accuracy.
Reducing the cost of your losses is tied inexorably to efficiencies.
will outline some of the critical first steps a fleet must examine if it is committed to reducing — typically by greater than 20% — the cost of injuries and accidents.
• Loss reporting. All fleet employees must be informed of the exact type of events that should be reported, the information required and the expected time frame in which to report an accident. To drive the point home, we recommend instructing drivers to report the event “just before it occurs.”
Drivers may be precluded, often by police, from securing information about the other parties. In that case, it may be enough for the driver to note the ICC number of another truck — or the license number and state of issuance for an automobile — in order to track ownership and insurance information quickly.
• Immediate analysis of the event and exposures. If we receive loss information in a timely manner, we should be prepared to have an experienced internal claim or risk person assess the reported facts and make decisions about the necessary next steps.
Hoping that an injury to your driver or a third party will not worsen over time is assuming that doctors, hospitals and lawyers are nonprofit entities. After the report has been completed, talk with your driver, but filter his or her verbal report. Is it consistent with what was initially reported? Are the facts plausible? Listen for inconsistencies and incomplete facts. The more questions you have after speaking with your driver, the more immediate is the need to uncover even more facts.
• Investigate now. I was once diagnosed, facetiously and by a nonmedical professional, as having an “urgency addiction.” The term fits my risk management role, and for good reason. An event occurs and our driver and truck are out there somewhere. We are a long way from our assets and our customer’s cargo. It is no longer sufficient merely to call a local, truck-knowledgeable adjuster to the scene when we have other tools at our disposal.
Consider a simultaneous phone and Web-based investigation to confirm or challenge what has been reported. Recorded statements from everyone involved after an event will be an important part of any investigation. It is surprising how humble and apologetic people involved in an accident can be when they are questioned immediately, before their version may be influenced or before an injury can “grow.”
• Medical management. Success managing your workers’ compensation claims will often hinge on two fundamental approaches: an early and thorough investigation with statements from the driver and witnesses, coupled with immediate medical management or injured worker management. Even in states where you are precluded by statute from directing medical care, you are within your rights to speak with the driver and guide him or her — with compassion for any injury — through the medical maze with the help of an experienced medical case manager.
Many drivers who join a new fleet have preexisting conditions, so you must be prepared for in-depth medical research to challenge those. Case closure plans should be compiled with your nurse case manager on the same day the accident is reported and should focus on getting the best medical care, so the driver can return to work as soon as possible.
• Direct involvement. The most common mistake fleets make is consciously to decide not to become personally involved. Nothing takes the place of a trucking company representative placing a call to a third party to inquire about his injuries, regardless of liability, and, when the facts are clear, to express concern.
A recent no-liability accident in California involving a 20-year-old who came into the oncoming lane had the involved fleet quickly assessing all available facts in order to decide whether to place a call to the grieving family or make a personal visit. The decision was made to visit family several days after the funeral. The family expressed gratitude — yes, gratitude — that a company, especially a trucking company, would be caring enough to get to know them. In conversation, they offered that the car likely veered into the truck’s path because of the deceased’s habitual inattentiveness.
Every process can be improved and your post-loss process should be scrutinized periodically for gaps or “leakage,” ensuring that accidents and injuries won’t cut into your profits.
Carom Data is a trucking risk services and consulting firm based in Concord, Ohio.
This opinion piece appears in the March 13 print edition of Transport Topics. Subscribe today.
