The Total Cost of Safety Risk to an enterprise is composed of two major elements: Safety Risk Financing (accidental loss related costs) and Safety Risk Controls (prevention and administration costs). In turn, Safety Risk Financing is composed of the costs of Workers Compensation Insurance premiums and Uninsured Losses retained by the enterprise. This article looks closely at the cost of Worker Compensation Insurance and controlling Worker Compensation Claims. In particular, it responds to rising total medical and indemnity costs despite reductions in overall recordable incident rates in Canada and the USA. Incident severity and fatality rates have been slowly rising in these two countries in recent years and are a large contributing factor. The Quebec and Ontario4 pulp and paper safety associations recently identified and expressed deep concern about this problem. So has the Association of Workers Compensation Boards of Canada (awcbc.org) to some extent. The article provides an overview of what employers can do to reduce workers compensation costs.
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