Trucking Risk Insights: Top 10 Vehicle Violations – 2016

Top 10 Vehicle Violations—2016

A roadside inspection is an examination of individual commercial motor vehicles and drivers by a Motor Carrier Safety Assistance Program (MCSAP) inspector to determine compliance with the Federal Motor Carrier Safety Regulations (FMCSRs) and/or Hazardous Materials Regulations (HMRs). Serious violations result in the issuance of driver or vehicle out of service (OOS) orders. These violations must be corrected before the affected driver or vehicle can return to service.

Trucking ViolationsJonathan Belek
Risk Management Consultant
jbelek@srfm.com

Jon Belek

Trucking P&C Pro-File Newsletter – February 2017

New Study Links Multiple Health Conditions to Preventable Crashes

It can be extremely difficult for commercial truck drivers to stay healthy on the job. Drivers often work long hours without rest, stay seated all day and don’t have access to exercise or nutritious meals. However, a new study conducted by the University of Utah School of Medicine found that drivers with three or more health conditions are much more likely to get into preventable crashes.

The study, which examined the medical records of nearly 50,000 commercial drivers, tracked a number of medical conditions that could have a negative impact on a driver’s performance—such as diabetes, high blood pressure, and anxiety.

Although the study found that drivers who have only one of the conditions

could often control it while on the road, the number of crashes increased significantly when drivers had three or more conditions. The average rate for crashes that result in an injury for all truck drivers is approximately 29 for every 100 million miles traveled, but the rate is 93 for every 100 million miles traveled for drivers who have at least three of the flagged conditions.

Transportation Industry Seeks to Limit New Rule-making

Representatives from the transportation industry have petitioned the Trump administration to slow the rule-making procedures of various federal agencies by adding more steps to the process and including business representatives in future rule-making discussions.

Although agencies such as the Department of Transportation (DOT) and the Federal Motor Carrier Safety Administration (FMCSA) currently go through public steps in their rule-making processes, some business owners believe that the Obama administration bypassed these processes through executive orders and safety advisories. They say this could force businesses to adopt costly new procedures with little evidence of their effectiveness.

New Interstate Passenger Resource

The FMCSA recently released an online

resource to help businesses that transport passengers across state lines. The resource includes a list of requirements that have changed over the years as a result of litigation, legislation, and rule-making. Additionally, passenger carriers can determine their registration requirements, minimum levels of financial responsibility and any applicable safety and commercial regulations.

For more information on keeping your business compliant with FMCSA regulations, contact us at 203-265-0996 today.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

Jon Belek

Construction P&C Pro-File Newsletter – February 2017

New OSHA Beryllium Standards

On Jan. 9, 2017, the Occupational Safety and Health Administration (OSHA) issued a final rule to amend its beryllium standards for the construction, shipyard and general industries.

The final rule will reduce the eight-hour, permissible beryllium exposure limit from 2.0 micrograms per cubic meter to 0.2 micrograms per cubic meter. It also establishes a short-term exposure limit of 2.0 micrograms per cubic meter over a 15-minute sampling period.

The rule will require additional protections that include personal protective equipment, medical exams, medical surveillance, and training.

The final rule becomes effective on March 21, 2017. Affected employers must provide newly required showers and changing rooms within two years after the effective date and implement new engineering controls within three years after the effective date.

OSHA estimates that the new rule will prevent 46 new cases of beryllium-related disease and save the lives of 94 workers annually.

Employers should become familiar with the new standards and evaluate their current workplace practices to ensure compliance with the final rule.

DOL Sues Contractor for Firing Safety Manager

According to a lawsuit filed on Dec. 28, 2016, a Tampa roofing contractor discriminated against its safety manager after he cooperated with an OSHA investigation. The Department of Labor (DOL) lawsuit was a result of an investigation by OSHA’s Whistleblower Protection Program.

Under the program, employers are prohibited from retaliating against employees who raise protected concerns or provide protected information to the employer or government. The lawsuit seeks back wages, interest, and injunctive relief as well as compensatory and punitive damages.

Construction Workers at Highest Risk for WMSDs

According to a recent Occupational and Environmental Medicine report, U.S. construction workers are at a higher risk of work-related musculoskeletal disorders (WMSDs) than all other industries combined. The back is the primary body part affected, with overexertion named as the major cause of WMSDs.

Employers should adopt ergonomic solutions at construction sites, such as training employees on safe lifting practices, in order to reduce the number of WMSDs and prevent lost wages.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

Jon Belek

Can Manufacturing Overcome the Widening Skills Gap?

Can Manufacturing Overcome the Widening Skills Gap?Manufacturing has always correlated with rapid economic growth. Time and time again we’ve seen manufacturing businesses create jobs and elevate a community’s standard of living. The development of a factory is the saving grace of poor communities all over the world.

The International Monetary Fund and U.S. government projections expect our manufacturing sector to grow by 3 or 4 percent over the next two years. It’s good business for investors, too: we add $1.37 to our national economy for every dollar invested in manufacturing. Despite this optimistic future, the industry is poised to face some familiar challenges.

Like other wealthy nations, the general population of the United States is aging. By 2025, nearly 25% of all persons will be older than 60.

The manufacturing sector is experiencing this trend the hardest. In 2000, the median age of the manufacturing workforce was 40.5 years old. In 2012, the median age climbed to 44.7 years, significantly higher than other sectors.

This aging of the industry has created a skills gap that is getting wider every year. Over the next decade, two million of the available 3.5 million manufacturing jobs will go unfulfilled. Employers won’t be able to find skilled workers.

Experts believe the talent gap is caused by a number of reasons:

  1. Baby boomers are beginning to retire in tremendous numbers, leaving more positions vacant than the up-and-coming workforce can fill.
  2. Trending economic expansion continues to create more jobs (about 700,000 over the next decade) that can’t be filled.
  3. There is a negative image of the manufacturing industry among younger generations. Even though executives are willing to pay higher than market rate, positions remain unfilled.
  4. There has been a slow decline of technical education in public schools, leading to fewer graduates pursuing science, technology, engineering, and math degrees.

The Manufacturing Institute found that a majority of manufacturing executives consider talent loss their toughest struggle. They fear the skills gap will cause an inability to create and implement new technologies to meet customer demand and increase productivity. Naturally, these challenges will deter profitability and growth.

The industry has come become quite diverse. Automation, data, robotics and engineering play a big role in nearly every manufacturing facility in the United States. Manufacturing is expected to continue changing, which means the industry desperately needs tech-savvy young people who can adapt to new processes and technologies.e a long way. Instead of easy-to-replace repetitive jobs, industrial operations hav

Admittedly, attracting a new workforce is challenging. In order to maintain some manufacturing status in the global economy, we have to infuse the industry with younger talent. Companies need to feed young people’s interest and show that manufacturing can be a rewarding career.

This can be best achieved by creating partnerships with schools (at the secondary and collegiate levels) to invest in technical education and offering extra-curricular programs that inspire manufacturing-related skills.

To combat the skills gap, employers need to view training and workforce development as an investment in their company, not an inconvenient expense. They must build never-ending learning into their employees’ roles so skills can stay sharp and agile. Furthermore, they need to find effective ways to transfer the knowledge of their aging population to the young recruits or risk losing competitive advantages.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com
Spring Hazards: Worker Safety During Warmer Weather

The Key to Controlling your Workers’ Compensation Costs

The key to controlling your workers’ compensation costsThe key to controlling your workers’ compensation costs is understanding your experience modification factor and its effect on your insurance premium. Workers’ compensation costs can make or break your bottom line. But control over these costs is more attainable than you may think if you understand your experience modification factor and its effect on your insurance premium.

Use Your Mod Factor

The key to controlling your workers’ compensation costs is understanding your experience modification factor, or mod factor. Your mod factor is an adjustment to your workers’ compensation premium. It’s based on your company’s actual losses compared to its expected losses based on the industry you’re in.

The mod factor represents either a credit or a debit that is applied to your workers’ compensation premium. A mod factor greater than 1.0 is a debit mod, which means that your losses are worse than expected and a surcharge will be added to your premium. A mod factor less than 1.0 is a credit mod, which means losses are better than expected, resulting in a discounted premium.

If your mod factor is over 1.0, show management how controlling costs can save you money on your insurance premium when it falls below the 1.0 threshold.

Control Your Mod Factor

You may not know it, but you do have control over your mod factor—and control over your workers’ compensation premium.

Your mod is calculated based on data reported to the rating bureau by past insurers. Incorrect or incomplete data can cause inaccurate mod factors. Review your loss and payroll data to ensure that your calculation is complete and accurate.

You can also control your mod factor by encouraging everyone to focus on safety—especially management and anyone else who is involved in controlling costs. Everyone working safely means fewer accidents to report to your insurance carrier and a lower mod factor.

Control Costs with a Return to Work Program

Another way to control your costs is to establish a return to work program and give modified or light duties to injured workers who can return to work.

Finding modified or light-duty tasks may seem inconvenient, but this is an important way to reduce your workers’ compensation costs—you pay for fewer days away from work and you keep regular contact with employees, so you can see how their recovery is progressing. The most successful return to work programs can accommodate almost any restrictions. 

Workplace Policies Help Control Costs, Too

Your workplace policies should encourage safe working habits and prompt reporting of injuries and accidents. Many companies have accident reporting policies in place but do not bother to implement them, which is dangerous because employees’ injuries could go untreated and hazardous situations will not be improved.

When you receive a claim for an on-the-job accident or injury, report it to your workers’ compensation provider as soon as possible.

After an accident or injury, investigate the event right away. Prompt investigation helps you preserve evidence and can deter employees from making fraudulent claims in the future.

If workers’ compensation costs are hurting you financially or if you want to learn more about how your mod impacts your premiums, Sinclair Risk & Financial Management is your resource for policies and guides to keep your costs in check. We’re here to help you protect your company and your bottom line.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

The key to controlling your workers’ compensation costs

Planning for Construction Risk

Planning for Construction RiskThe construction industry is flourishing, with outlooks like the Wells Fargo 2016 Construction Industry Forecast’s Optimism Quotient predicting that local construction, profits, equipment purchases and rentals and overall future growth will be strong this year.  Add to this that warmer weather means the busy construction season is here and it’s a great time to be in the industry, whether you’re an independent contractor or you own a large building construction firm.

However, as you take on more work, you also need to make sure that your risk exposure and insurance coverage is keeping up.  For example, you may hire more workers or rent more equipment to keep pace with your workload, which opens you up to more potential issues, like safety and liability. What if a new worker is injured using construction equipment, the materials you purchased for a huge job are stolen or a homeowner sues you because they feel there was design error in a job you performed for them?

Make sure you are protected against potential pitfalls with these three tips:

1)     Appropriately Assign Risk - Quite simply, think through anything that could go wrong in a project, plan for it and assign the risk to the person who would be most capable of handling and controlling it.  For example, a contractor can best control the safety of the workers on a job site while the homeowner would probably be the best choice for any project design risks since they’re most likely working with the architect and designers.  By spelling out risk responsibility in the contract before the project even begins, everyone is clear in advance about who is responsible for what risk.

2)     Make Sure You’re Covered - Once you know what your role and area of responsibility is, work with a trusted risk and financial management firm that has expertise in the construction industry and will take the time to sit down, understand your unique challenges and customize a program for you.  From Errors and Omissions coverage to Workers’ Compensation to OSHA concerns, ensure you’re aware of and protected from any of the risks associated with your projects.

3)     C.Y.A. – Cover your assets by making sure you closely examine all contracts for consistency and that you also have an experienced and knowledgeable attorney review all contracts.  Also – don’t rely on a cursory review of a certificate of insurance to prove that the parties you’re working with on a project are compliant with insurance requirements.  Beyond requiring a certificate of insurance proving proper insurance coverage in the contract, consider requiring that the full policies be included to provide evidence of adequate coverage.

With the right planning, risk management and insurance coverage, you can enjoy the benefits of the construction boom without the headaches.  At Sinclair Risk & Financial Management, we take the time to understand your company and individual situation and work with you to help you minimize your risks.  Give us a call today!

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

Spring Hazards: Worker Safety During Warmer Weather

Spring Hazards: Worker Safety During Warmer Weather Spring signifies the end of winter and a season of new beginnings.  It ushers in budding trees, blooming flowers and warmer temperatures.  It can also bring with it quickly changing conditions and hazards that employers and workers need to be aware of and prepare for to ensure safety.

 While, overall, workplaces are safer today, many people are still seriously injured on the job, especially in industries like manufacturing, construction, transportation, warehousing and oil and gas extraction.  While accidents happen, many are preventable. In fact, the Occupational Safety and Health Administration (OSHA) found that more than 10,000 severe injuries were caused by workplace conditions in 2015.

 What top three hazards do employers need to be aware of during spring? 

  1. Severe Weather and Flooding- Floods and tornadoes are the most common hazards in the United States during spring.  From melting snow to sudden spring showers, flooding can happen quickly and with little warning.  Not only should workers and employers be aware of weather forecasts, but workers should be trained on severe weather plans and have emergency supplies with them to be prepared if severe weather strikes.  OSHA and the National Oceanic and Atmospheric Administration (NOAA) have partnered to provide a comprehensive resource aimed at helping businesses and workers prepare for severe weather, like flooding
  2. Outdoor Work – From construction workers on scaffolding to flagmen helping to direct traffic at highway work zones, outdoor working conditions in the warm spring weather can naturally cause hazards for workers. In fact, more than 100 workers are killed and more than 20,000 are injured in the highway and street construction industry each year, with over half of the fatalities resulting from vehicles and equipment operating around the work zone. It’s imperative that employers put controls in place and train employees to protect workers from injury in outdoor settings.  The National Institute for Occupational Safety and Health provides guides for many industries.
  3. Driving and Pedestrian Safety – As the warm weather approaches, more people get out to enjoy the warm weather – from people walking dogs to motorcyclists enjoying a ride to children riding bicycles.  Naturally, this means that there are more incidents of accidents involving driving and pedestriansIt’s important that drivers properly maintain their vehicles, exercise caution, travel at a reasonable speed, pay attention and avoid distractions like texting.    

Employers are required by law to provide their workers with a workplace free from serious recognized hazards and to comply with standards, rules and regulations issued under the OSH Act.  In addition to ensuring safety protocols, plans and training take place to prevent workplace accidents and injuries, each industry has its own nuances and risks.  At Sinclair Risk & Financial Management, we take the time to understand your company and individual situation and work with you to help you minimize your company’s risks. 

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

Spring Hazards: Worker Safety During Warmer Weather

Are you Protecting Your Construction Business Properly?

Are you Protecting Your Construction Business Properly?2016 is expected to be a strong, steady year of growth in the construction industry, with the 2016 Dodge Construction Outlook predicting that the U.S. construction starts for 2016 will rise 6% to $712 billion.  This environment is expected to be supported by the U.S. economy, with relaxed lending standards and support from state and local construction bond measures.  And while the Federal Reserve increased short-term interest rates by 0.25% at the end of 2015 for the first time since the financial crisis, long-term rates are expected to rise more gradually.

With spring’s busy season right around the corner, there are several trends that industry experts are also watching, including the overwhelming issue of a lack of access to skilled labor.  The combination of layoffs during the economic downturn along with a slowdown in immigration  is contributing to the industry’s skilled worker shortage.  This talent deficit is only worsened by the industry’s struggle to appeal to the younger, more tech savvy workforce during a time that a large number of baby boomers are retiring and companies need skilled workers at all levels.

In addition, while the outlook is good for the construction industry, businesses are facing a competitive landscape and increasing customer expectations for a quality job to be done on time and on budget with limited resources.  More and more businesses are facing a variety of risks associated with this environment, such as claims of faulty workmanship, design errors or omissions and the use of defective materials and products.

These types of claims are challenging because they can result from a number of factors and can occur years after a project is completed.  They can also be devastating to a business that may have a commercial general liability policy, which would cover property damages resulting from accidents or occurrences, but may not be protected against claims of faulty workmanship.  If you provide construction services, install products during your construction services, provide in-house design or engineering services (or subcontract design services out) and perform the construction, you are at risk.

Many businesses choose to protect themselves with Errors and Omissions coverage. Essentially, Errors & Omissions coverage provides protection for you in the event that an error or omission on your part has caused a financial loss for your client.

Regardless of how well a business is run, mistakes, errors and omissions occur and even unfounded allegations can costs thousands of dollars in defense. Additionally, even false claims can damage a company’s reputation and impact profitability.  So how do you protect your company and reputation?  Work with a trusted risk management partner that will take the time to understand your business and particular challenges and help put together the right coverage for you.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

 

Hiring a contractor? Don’t get caught without ‘Additional Insured’ protection

It’s that time in your home’s life that fortunately only comes around once every 20 to 25 years or so…roof replacement time! Or maybe it’s time to tackle a big task with a shorter life span, like painting the house.

Either way, for projects at this scale you wisely skip the DIY approach and instead find yourself in the market for a contractor.

Let’s take roof replacement as an example. The roofer contractor you’ve zeroed in on came with a great recommendation from a friend, supported by an attractive portfolio and sharp online presence. Is he insured? Of course! You sign a contract, pick out the shingles and are ready to go, right? Not so fast.

Even though your contractor has proof of insurance and you carry homeowner’s insurance, you could still face a coverage gap and corresponding risk, plus the potential of higher premiums should you have to file a claim on your policy because of a peril related to your roofing project.

To close the gap and eliminate all potential pitfalls, make sure your roofer at the very least adds you as an “additional insured” to his general liability policy before you sign the contract. It’s easy and cost efficient for him to do so and the right move for both of you.

When you’re added as an additional insured, it means the insurance carrier underwriting the policy extends its coverage to you for a certain term. There are many reasons for why this can come in quite handy. Consider these two examples:

Your contractor is in your attic checking the roof sheeting. It’s dark and he accidently falls through a hole in the floor and gets hurt. If you are named as an additional insured, you’re protected against a lawsuit because his policy coverage for accidents such as this now Constructionapplies to you as well. However, as part of the contract between you and the roofer, it’s important to include a “waiver of subrogation clause, which would prevent the contractor’s insurer from pursuing your insurance company (or you) for costs related to any worker’s compensation claim that may be filed. No claims filed against your policy means your premiums stay in check.

Another important clause to your additional insured policy is “completed operations” coverage, which essentially means the coverage survives the end of the job. Let’s suppose the roof is complete and the contractor has cleaned up and gone on to his next job. The following day, a UPS driver is walking up your driveway to deliver a package and steps on an overlooked roofing nail, causing an injury. The driver sues, but since this was the fault of the roofing company AND you had additional insured with completed operations coverage, the roofer’s insurance carrier is still yours in this case and will handle the litigation and any payout. You are liability free and again, your homeowner’s insurance stays untouched.

Additional insured clauses are an easy way to protect yourself when contractors are working on your home. They are commonly used and take almost no time to secure, so make sure you insist on one for your next home improvement project.

Jonathan Belek
Risk Management Consultant
jbelek@srfm.com

 

Contractors – The fine print on Waivers of Subrogation

Jonathan-BelekYour firm gets tapped to build a brand new office building in a promising location. The budget is high and the timeline reasonable. You can’t wait to sign the contract and get started. That “Waiver of Subrogation” it includes? You’ve seen it before and haven’t thought too much about it, as it seems to be becoming standard boilerplate. But just how important is it? Super important.

Waivers of subrogation are pretty much a must-have in today’s contracting world, and they create a significant condition that bears understanding in full. The basics on what exactly is subrogation and why would one agree to waive it are as follows:

A building is destroyed because of the negligence of an electrician working on it. This is a standard “covered peril” and per the owner’s insurance policy, the owner’s insurer is obligated to make the owner whole and pay a claim to cover the loss. The legal principle of “subrogation” then allows the insurer to literally step into the legal shoes of the owner and pursue the electrician (more likely, the electrician’s insurer) to recover the funds it paid Contractual Risk Managementout to the owner.

But if the owner and electrician had agreed to a “waiver of subrogation” as part of their contract for service, the owner’s insurer would not be able to pursue the electrician for damages and would instead carry the full risk exposure.

Naturally, waivers of subrogation often mean higher premiums, especially if a carrier is forced to pay a claim and cannot pursue a negligent third-party for reimbursement.

Sometimes contractors working on a particular job all agree to waive subrogation to avoid the uncertainty, hassle, and cost of litigation, and to collectively place the risk on the insurance carrier whose party suffered the loss, regardless of who caused it. Some would argue that minimizing the possibility of legal action and placing risk squarely in the lap of the insurers promotes better business relationships and keeps costs lower…(assuming of course, that nothing happens and premiums don’t skyrocket after a claim).

But waiving subrogation also means waiving your own right to sue. After all, when an insurance carrier subrogates, they are acting as a legal stand-in for the insured, assuming his or her rights. But a waiver is a surrender of rights to sue someone who causes you injury.

Feeling squeamish about giving up your right (and by proxy, the right of your carrier) to sue to recover damages? That’s totally understandable. But the reality in today’s construction marketplace is waivers are becoming standard. Don’t like it and don’t want to agree to it? In many cases you won’t get the job.

If you agree to a waiver of subrogation, what happens when the job is complete? That’s not always clear in some contracts, which can create the risk of unexpected future liability.

Once a project is complete, the owner’s insurance company may still try to pursue architects and contractors to recover damages if issues arise after the fact, even from fire, flood, and other natural disasters.

Obviously at this point, it’s in the interest of those third-parties for the waiver of subrogation to survive project completion. The clearest way to make sure that’s the case is to include a “completed project insurance clause” that specifies that a waiver of subrogation survives.

Looking for further guidance on the complicated topic of subrogation? Get in touch with me today.

Jon Belek
Sinclair Risk & Financial Management

jbelek@srfm.com