Third Quarter Chaos
by Kirk Lloyd, Risk Management Services, Inc.
At a recent meeting of the ABC Safety Committee, we had an
opportunity to see statistics from SAIF Corporation that show a
significant pattern to the claims filed by the members in the ABC/SAIF
worker’s comp discount group.
On a statewide basis, detailed records are kept for each worker’s
comp class code, including how much payroll is generated, how many
claims are filed and how much those claims cost. From this statewide
data collection, it is possible to create models and projections.
SAIF was able to analyze the payroll reported by all the members in
the ABC/SAIF group and make a statistical prediction of how many
claims would be filed for each class code. This prediction takes
into account the growth and membership changes that have occurred
over time. The expected frequency of claims is then compared to the
total number of actual claims that are being filed by the group on a
quarter-by-quarter basis. The results from the ABC/SAIF group are
shown in the graph below. |
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Remember that the existence of the ABC/SAIF group discount is based
on having actual losses that are less than would be expected. The
group performs fairly well during most of the year, but look closely
at the third quarter results. Actual claims frequency shows a
consistent spike during that period of the year, often going well
above the projected level. In some ways that should be no surprise –
that is the peak of seasonal activity when conditions can get a
little chaotic. However, that spike represents real injuries to real
people, with a very real cost both in terms of human factors and the
business bottom line.
Does it have to be this way? We don’t believe it does, and in the
months to come the Safety Committee will focus on the opportunities
we have to address this challenge. Take a look at the article on
Seasonal Worker Safety that appears in this issue of Ag Link and be
watching for more on this subject in the future.
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