Bringing insurance-related risk management practices to our customers in an interesting, efficient and effective manner is one of the primary goals of the Island Institute. Island Insurance Company customers are typically smaller companies, not very sophisticated in terms of risk management practices, and have no full time resources to allocate to, nor experience in safety and claims management.
Two particular developments in recent years led to the need to create the Institute. These were growth in writing workers' compensation and an increase in the customer segment that included contractors. Growth in both areas entailed high risk, especially in combination with each other. Thus, the first endeavor was titled, "What Contractors Need to Know about Workers' Compensation."
Here are some of the challenges that were evident with this group of contractor customers:
Small- and medium-sized contractors are busy and stretched thin at the top
The owners are in a competitive business and don't like to incur extra costs
They see safety as another thing to do
They see claims as a problem not to be solved but one they wish would just go away
Many will not put safety in their estimating details for competitive reasons
Many, due to competition, will take lowest or low bids when hiring subcontractors
They have to deal with weather delays and change orders that can create stress in meeting deadlines and client expectations
In boom times, many experience manpower shortages
In boom times and/or in the aftermath of a mega natural disaster, many experience material shortages or difficulty in getting material on a timely basis:
Boom time
Post-Katrina/wildfires/hurricanes in Florida
Any good project needs to have a trial run, so we did that. What resulted was a complete revamp of content and time adjustments, expanded to accomplish the mission. The initial half-day class was pretty traditional and included the following: the history of workers' compensation; the true cost of accidents; the accident iceberg, as well as a safety handbook for contractors, among other things. It was well received and had plenty of support material, but lacked what was necessary to call management to action and provide the supervisors with the abilities they needed to get the job done.
There are formulae for things we know are important, and we often go about giving the same advice and information, over and over, with limited results. This is a common practice of insurance companies. What would be a better approach in providing business success strategies to our customers that would also be beneficial for the insurance company? We know that risk, without forethought and effective management, will usually result in bad things happening. This is a particularly difficult concept to get across to small business owners because they do not think anything really bad will happen to them. Most of the time, luck induces a false sense of security, especially for those businesses that have yet to experience bad accidents or lawsuits.
