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Risk Insider: Andy Hosman

Data Matters; Regardless of Regulatory Shifts

By: | July 6, 2017 • 3 min read
Andy Hosman is the vice president of Operational Risk Solutions at Sphera. He has more than 17 years of experience in designing, developing, and implementing risk management solutions to help customers assess, mitigate, manage and monitor their risk more effectively. Prior to joining Sphera, Andy was a senior vice president of product management at Marsh ClearSight.
Topics: Risk Insider | Safety

On May 31, a Topeka, Kansas, worker was killed when a forklift pinned him against another piece of equipment, according to the radio station KVOE-AM.

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Tragedies like this one are far too common, and no loss of life from a workplace incident is ever acceptable. The U.S. Occupational Health and Safety Administration (OSHA) reports that 4,500 people die every year in the United States from work-related accidents, and studies have shown the cost of occupational injuries and illnesses to employers could be as much as $250 billion per year.

With the recent disapproval of OSHA’s clarification on its recordkeeping rule, known as the Volks Rule, there is a lot of focus on the amount of time that data should be retained.

Ultimately, the discussion should not be centered on whether companies should be legally required to maintain incident records for the current six-month period or the five-year period under Volks. Instead, the conversation should be focused on using data as an analytical tool that helps both employers and workers.

The key to improving workplace safety is understanding the causes of the incidents and near-misses that take place in a company and putting measures and systems in place to mitigate them. That’s where good quality incident data comes into play.

A larger, more statistically robust data set enables companies to understand the true cause-and-effect relationships between workplace incidents and the measures put in place to reduce their frequency and severity.

Six months of recordkeeping will provide only enough data for the employer to perform initial root-cause analysis across incidents. This information is valuable because it allows the organization to learn from those events and take corrective actions.

However, this limited scope of data might not allow for understanding the long-term effects of changes to workplace safety or broader trends across the organization. It also does not allow for effective benchmarking against an industry peer set to acquire more valuable predictive and prescriptive analytics, which are vital to maintaining safe workplaces.

So how much data is enough?

Incident data is a critical lagging indicator of the effectiveness of a company’s safety program. Without sufficient historical data, companies are more likely to see accidents repeat themselves. A larger, more statistically robust data set enables companies to understand the true cause-and-effect relationships between workplace incidents and the measures put in place to reduce their frequency and severity.

This allows companies to shift their focus toward leading indicators that are captured from proactive risk measures, such as assessments and inspections, to predict where incidents are more likely to occur and so companies can allocate their resources accordingly.

Aside from the analytical value of the data, the transparency of key incident metrics and key performance indicators to employees is important to drive a culture of safety. Employers that present workers with regularly updated graphs or dashboards of key safety metrics demonstrate that they care a lot about their workers’ well-being, and the more information companies collect will help mitigate risks.

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This level of transparency and access to information increases employee morale, reduces incidents and — ultimately — lowers insurance premiums.

The disapproval of the Volks Rule reflects a bare minimum level of compliance across U.S. industries, but that shouldn’t stop companies from retaining quality incident data for multiple years to realize the true value of their safety data.

A commitment to operational excellence through continued learning and improvement in safety has led to increased earnings and performance for major corporations, and the power of data is the key to this improvement.

More from Risk & Insurance

More from Risk & Insurance

Risk Management

The Profession: Curt Gross

This director of risk management sees cyber, IP and reputation risks as evolving threats, but more formal education may make emerging risk professionals better prepared.
By: | June 1, 2018 • 4 min read

R&I: What was your first job?

My first non-professional job was working at Burger King in high school. I learned some valuable life lessons there.

R&I: How did you come to work in risk management?

After taking some accounting classes in high school, I originally thought I wanted to be an accountant. After working on a few Widgets Inc. projects in college, I figured out that wasn’t what I really wanted to do. Risk management found me. The rest is history. Looking back, I am pleased with how things worked out.

R&I: What is the risk management community doing right?

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I think we do a nice job on post graduate education. I think the ARM and CPCU designations give credibility to the profession. Plus, formal college risk management degrees are becoming more popular these days. I know The University of Akron just launched a new risk management bachelor’s program in the fall of 2017 within the business school.

R&I: What could the risk management community be doing a better job of?

I think we could do a better job with streamlining certificates of insurance or, better yet, evaluating if they are even necessary. It just seems to me that there is a significant amount of time and expense around generating certificates. There has to be a more efficient way.

R&I: What was the best location and year for the RIMS conference and why?

Selfishly, I prefer a destination with a direct flight when possible. RIMS does a nice job of selecting various locations throughout the country. It is a big job to successfully pull off a conference of that size.

Curt Gross, Director of Risk Management, Parker Hannifin Corp.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

Definitely the change in nontraditional property & casualty exposures such as intellectual property and reputational risk. Those exposures existed way back when but in different ways. As computer networks become more and more connected and news travels at a more rapid pace, it just amplifies these types of exposures. Sometimes we have to think like the perpetrator, which can be difficult to do.

R&I: What emerging commercial risk most concerns you?

I hate to sound cliché — it’s quite the buzz these days — but I would have to say cyber. It’s such a complex risk involving nontraditional players and motives. Definitely a challenging exposure to get your arms around. Unfortunately, I don’t think we’ll really know the true exposure until there is more claim development.

R&I: What insurance carrier do you have the highest opinion of?

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Our captive insurance company. I’ve been fortunate to work for several companies with a captive, each one with a different operating objective. I view a captive as an essential tool for a successful risk management program.

R&I: Who is your mentor and why?

I can’t point to just one. I have and continue to be lucky to work for really good managers throughout my career. Each one has taken the time and interest to develop me as a professional. I certainly haven’t arrived yet and welcome feedback to continue to try to be the best I can be every day.

R&I: What have you accomplished that you are proudest of?

I would like to think I have and continue to bring meaningful value to my company. However, I would have to say my family is my proudest accomplishment.

R&I: What is your favorite book or movie?

Favorite movie is definitely “Good Will Hunting.”

R&I: What’s the best restaurant you’ve ever eaten at?

Tough question to narrow down. If my wife ran a restaurant, it would be hers. We try to have dinner as a family as much as possible. If I had to pick one restaurant though, I would say Fire Food & Drink in Cleveland, Ohio. Chef Katz is a culinary genius.

R&I: What is the most unusual/interesting place you have ever visited?

The Grand Canyon. It is just so vast. A close second is Stonehenge.

R&I: What is the riskiest activity you ever engaged in?

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A few, actually. Up until a few years ago, I owned a sport bike (motorcycle). Of course, I wore the proper gear, took a safety course and read a motorcycle safety book. Also, I have taken a few laps in a NASCAR [race car] around Daytona International Speedway at 180 mph. Most recently, trying to ride my daughter’s skateboard.

R&I: If the world has a modern hero, who is it and why?

The Dalai Lama. A world full of compassion, tolerance and patience and free of discrimination, racism and violence, while perhaps idealistic, sounds like a wonderful place to me.

R&I: What about this work do you find the most fulfilling or rewarding?

I really enjoy the company I work for and my role, because I get the opportunity to work with various functions. For example, while mostly finance, I get to interact with legal, human resources, employee health and safety, to name a few.

R&I: What do your friends and family think you do?

I asked my son. He said, “Risk management and insurance.” (He’s had the benefit of bring-your-kid-to-work day.)

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]