Any business owner knows that sound risk management provides a foundation on which to stack all other operation strategies -- and a great way to reduce accidents and injuries and lower your Workers Comp premiums.
Because this is such an important topic, here are the seven essential benefits of a risk management program, according to The National Alliance for Insurance Education & Research:
For more guidance on planning and implementing risk controls, see The Importance of Risk Management for Business Owners.
Seven essential benefits
- Reduced cost of accidents
- Providing adequate protection
- Economy of operations
- Integration of safety plans
- Reduced risk of criminal liability
- Ability to plan and budget more effectively
- A clearer focus on the big picture
Recommended risk manager duties
- Develop and communicate risk-management policies
- Prepare recommendations and reports
- Conduct risk-identification surveys
- Analyze and measure exposures
- Review leases and contracts
- Coordinate compliance with regulations
- Implement risk-control programs
- Investigate accidents
- Manage claims and litigation
- Arrange risk financing (including insurance); establish retention programs
- Determine and allocate cost of risk
- Monitor results
Additional resources on program components and insurance considerations are available from Risk Management in Insurance.
Our agency would be happy to review your risk management program at your earliest convenience and recommend precautions that can help keep Comp premiums under control — please review with an insurance agent.
Frequently Asked Questions
What is a risk management program?
A risk management program identifies potential hazards, evaluates exposures, and implements controls to reduce losses and protect people, assets, and operations.
How can risk management lower Workers' Comp premiums?
By reducing the frequency and severity of workplace injuries through prevention, training, and controls, employers can lower claim costs, which may lead to lower premiums over time.
Who should oversee a company's risk management efforts?
Either a designated risk manager or a qualified member of management should oversee the program, coordinating across departments and with outside advisors as needed.
How often should a risk management program be reviewed?
Programs should be reviewed regularly—at least annually—and updated whenever operations, staffing, or exposures change materially.