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6 Tips to save money on your workers’ comp insurance

 By Thomas J. Phelan, CPA
 President and CEO
 Chesapeake Employers’
 Insurance Company

In today’s challenging economy, businesses continue to look for ways to save money on their bottom line. One often overlooked way to do this is to focus your efforts on workplace safety and injury management.

A workplace safety and injury management program can help prevent accidents in your workplace. And preventing on-the-job accidents not only reduces injuries and fatalities, but can also help you save money on:

• Work comp and medical insurance costs;
• The cost of conducting accident
• The cost of replacing and retraining
   employees; and
• The cost of fines for violating state or
   federal industry regulations.

And these are just some of the direct costs associated with on-the-job accidents. There are a host of indirect costs associated with them as well.

The case for workplace safety and health is so strong, in fact, that Dr. David Michaels, Assistant Secretary of Labor for OSHA, recently stated: “For every dollar spent on an injury and illness prevention program, [employers] can expect [to see] up to six times a return on their investment.” (Remarks made at the Voluntary Protection Programs Participant Association’s Annual Meeting, National Harbor, MD, Aug. 25, 2014.)

So, what can you as an employer do to
enhance your workplace safety and injury management efforts? These tips have proved effective for many Chesapeake Employers’ policyholders:

1. Adopt a company-wide safety
A commitment to safety from
your company’s leadership is the first
– and most important – step you can
take to reduce accidents and lower your
work comp insurance costs. Because a
majority of accidents are caused by unsafe
behaviors, it is essential for management
at all levels to commit to a safe and healthy
workplace for all employees.

2. Employ good hiring practices.
A well-organized recruitment and hiring
process will ensure better qualified
employees and a better fit for you and your employees. Your goal is to hire an all-star employee, not your next work comp claim.

3. Establish a drug-free workplace.
According to the 2013 National Survey
on Drug Use and Health, nearly 70% of
all adult illicit drug users age 18 or older
are employed full or part time. Under
Maryland law, Health-General §17-214,
employers may test their employees for
any legitimate business purpose for the
use or abuse of any controlled dangerous
substance or alcohol. Chesapeake
Employers’ Insurance encourages pre-employment, post-accident, and random drug testing.

4. Provide safety training at all
Safety training is really the key
to preventing work-related accidents
and injuries. When properly trained,
supervisors can set the standard for
behavior each day by ensuring all
company safety rules and regulations are
followed, and employees will know how
to prevent accidents by following proper
workplace safety procedures.

5. Establish a prompt injury reporting
. Prompt injury reporting is a very
important step in controlling the cost
and duration of your work comp claims.
Develop procedures for supervisors and
employees to report injuries within 24
hours of the accident. Early intervention
helps ensure the best medical outcomes
for the injured worker, and helps reduce
unnecessary attorney involvement and
costly litigation later on.

6. Establish a return-to-work program. An effective return-to-work program minimizes lost time by encouraging your injured worker to return to work more quickly once he or she is medically cleared to do so. A return-to-work program is a formalized policy that seeks to bring your injured worker back to work in a modified or transitional duty capacity, once cleared by a physician and medically able to do so. This not only helps the injured worker tremendously, but it helps to lower medical and indemnity costs, resulting in savings for your company.

Thomas J. Phelan, CPA, is President and
CEO of Chesapeake Employers’ Insurance Company (, the largest
writer of workers’ compensation insurance in Maryland.


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