Thursday, August 19, 2010

The Real Costs of an Accident and Three Ways to Reduce Them!

I recently received a document, from Chris Bowe, Regional Program Manager for the Department of Labor and Industries, describing the real costs of an accident. Just as a reminder to you, I thought I would repeat the information in this column and provide three ways that you can reduce the risk of incurring these costs:

Direct-Insured Costs

• Worker’s compensation premiums
• Medical expenses (hospital, doctors)

Indirect- Uninsured Costs (Out-of-Pocket)

• Time lost from work by injured employee
• Lost efficiency
• Lost time by supervisor
• Training costs for new/replacement workers
• Damage to tools and equipment
• Loss of production
• Damage from accident: fire, water, chemical, explosives, etc.
• Failure to fill orders/meet deadlines
• Overhead costs while work was disrupted
• Other miscellaneous costs

No matter the size of your business, you can access three services, for free, that can help you reduce the risk of injuries, reduce the risk of hiring or retaining high-risk employees and speed the process of getting an injured employee back to work as quickly as possible. Your Worker’s Compensation rates already pay for these services so why not use them. In a nut shell they are as follows:

1) Reduce the risk of an employee getting hurt by requesting a consultation with a safety and health expert (DOSH Consultation) to identify potential safety and health concerns and industrial hygiene issues. Take a proactive approach to avoiding problems by requesting a consultation.

2) Identify other potential risks by asking for a Risk Management Consultation to gain a better understanding of how to manage claims, reduce the risk of hiring the wrong people and otherwise setting your business up for potentially higher premiums.

3) Finally, learn about the Early Return-to-Work Program and how important it is to maintain good communications between your injured employee and the doctor involved in treating the employee. (See the guide at:

Valuable resources from the Department of Labor and Industries can be accessed on their new website:

The above information was adapted from materials provided by the Washington Department of Labor and Industries and summarized by Susan Hoosier, Certified Business Advisor and Certified Economic Development Professional, with the Washington Small Business Development Center in Longview, WA 360-442-2946. Susan has owned and operated three businesses and managed a revolving loan fund for a Midwestern Regional Development Commission.

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