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For Your Insureds, Disparate Systems Are a Recipe for More Risks

For Your Insureds, Disparate Systems Are a Recipe for More Risks

From property and casualty risks to HR challenges, employers these days face more uncertainties than ever.

Insurance brokers can—and should—help their clients manage those uncertainties. But too many brokers end up doing the opposite. They create further complications for their insureds.

The fact is that most brokers overlook the recordkeeping, reporting, and employee training systems their clients use, even when those systems have proven ineffective or problematic.

In some cases, brokers add more unnecessary, costly, and ultimately unproductive systems into the mix. In other words, they saddle insureds with products that were designed for brokers, not employers.

Are your clients stuck with systems that amplify rather than alleviate key areas of risk? To find out, see if you can answer the following questions.

Do Your Insureds Use Consistent Systems for Maintaining Their Documents?

Policies are integral for ensuring workforce safety and minimizing HR liabilities. However, if not everyone at an organization can access the same information, the rules are little more than words in a book.

As we like to say around here: if it wasn’t documented, it didn’t happen. A centralized system can ensure that it happens—that organizational rules are followed consistently, and that every worker has acknowledged the appropriate policies, as the Occupational Health and Safety Administration expects.

The same is true for safety records. OSHA requires that employers keep consistent logs of workplace injuries. If records of policy sign-off, employee training, safety committee minutes, and so forth differ from location to location, the organization is more likely to subject themselves to issues, increased liability, and potential fines.

Without a consistent system available to every location, an organization is also likely to experience workforce management issues. Two locations shouldn’t be following two different processes for hiring, discipline, or termination. A standardized, unified system makes sure that managers are treating everyone equally and not acting in a discriminatory manner or creating gaps during HR sequences.

Do They Know the Costs of Maintaining Separate Systems?

The use of multiple, disconnected systems drains an organization of thousands of dollars every year. The annual spend for a learning management system typically ranges from $15,000 to $20,000. And that’s just the LMS. An insured may also be paying…

●      $5,000–$10,000/year for a Safety Data Sheet system

●      $7,000–$10,000/year for a certificate tracking system

●      $7,000–$10,000/year for an incident management system

●      $7,000–$10,000/year for an auditing tool

Collectively, that means offsetting upwards of $40,000 every year. Additionally, many systems also charge per employee.

Aside from the costs of managing separate systems, there’s also the inefficiency of navigating different tools and vendor relationships. Employees must be trained to use the various software, dashboards, and apps at their disposal. Different systems tend to have different technological and operating requirements; perhaps one tool is built for mobile devices while another works only on desktop computers. Many systems don’t integrate easily with each other, leading to potential errors and duplication of effort.

And zero systems are worse than multiple systems. These costs multiply when documents only exist on paper. In 2020, there’s no excuse for using binders and spreadsheets. For one, in our ever-changing regulatory world, paperwork is almost always outdated. Second, they siphon time and energy away from business.

Employees should be able to access their assigned documents and required training digitally, on demand, using the devices in their pockets. Every second spent digging through paperwork or asking a safety manager to produce lockout/tagout procedures is a second that could have been spent working.

Do They Have Easy Access to Organizational Data and Reporting for Trending Analysis?

Multiple, disparate tools create silos, which can present serious costs and headaches for employers. Without a unified system, it’s difficult—if not impossible—to spot issues where they exist and prevent incidents before they occur.

This is about incident tracking. Imagine a property management firm with 150 buildings across 10 states. The organization is seeing an uptick in slips, trips, and falls—resulting in high numbers of claims and increased costs.

Without a unified system, there’s little the firm can do to pinpoint and effectively address the issue. The organization can’t see that falls are occurring most often at a certain facility or involving a specific category of workers.

With a unified EHS and HR system, the firm can generate a report that shows where, when, and why the issue is happening. The organization can see that falls occur most often at a facility in Texas where ladders are frequently in use. The system thus allows for a targeted remedy to a specific problem—the Texas office can be inspected, employees can be trained on ladder safety, and ladder policies can be updated accordingly.

KPA’s Risk Management Center: The Right Solution for Your Clients and Your Brokerage

Ready to improve your clients’ lives and generate more business for your brokerage? KPA has the unified EHS and HR system your insureds are looking for.

With KPA’s Risk Management Center, you’ll stand out from the competition and become your clients’ lasting broker of record—the partner they trust for risk management assistance and guidance.

Access comprehensive tools to control and mitigate operational, regulatory, and compliance risks:

●      award-winning training courses

●      facility inspections

●      incident tracking with OSHA 300 Logs

●      Certificate of Insurance (COI) management

●      bilingual risk management documents and resources

●      on-demand access to HR and legal experts

●      and much more

Explore the Risk Management Center.

About The Author

Rob Stansbury

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