Column: Workers' Comp

Opinion | When Wildfires Make Breathing a Work Hazard, Claim Costs Could Suffocate Employers

By: | September 14, 2018 • 2 min read
Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

Smoke clogs the Idaho valley where I live annually and with regularity. For me, the smoke that NASA satellite images show shrouding much of the Western U.S. represents mounting evidence of climate change.

The problem hasn’t yet touched workers’ comp. But if scientists are right, and we are experiencing a new normal in wildfires, the smoke will affect overall worker health far beyond the flames’ reach, in turn impacting workers’ comp claims outcomes.

For insurers, global warming and wildfires are largely a property issue — for now. Swiss Re, which has been at the forefront of addressing climate change, reports worldwide wildfire frequency has been increasing for decades. A record-setting $14 billion in insured wildfire losses occurred in 2017— most of that in the U.S. and Canada.

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Some work-related losses are obvious, although they remain low frequency. Think of the firefighters who died this year battling California blazes or the electrical lineman who perished restoring power in a California burn area; as fires burn, more workers will face hazardous environmental conditions removing the debris of lost homes.

There is a broader picture, however.

Where I live, smoke pours in from California fires nearly 1,000 miles away. It drifts over the mountains from forests burning in Oregon, Washington state and British Columbia. If the wind shifts, it comes from Montana. We also have 10 wildfires burning here in Idaho.

If scientists are right, and we are experiencing a new normal in wildfires, the smoke will affect overall worker health far beyond the flames’ reach, in turn impacting workers’ comp claims outcomes.

It’s early August as I write this column, early in an ever-lengthening fire season, and the smoke blocks my view of the mountains a few miles away.

Residents are warned to avoid strenuous outdoor exercise, especially sufferers of respiratory conditions. But construction workers are still laboring strenuously, delivery drivers are hurriedly carrying packages to doorsteps and garden landscapers are all outdoors sucking in dangerous particulate matter.

With 106 large wildfires currently burning in 15 states, the impact is felt across more Western cities.

If we know that exercise, not smoking and other good behaviors, improve worker health and productivity — as well as improve workers’ comp claims outcomes — what does all this smoke tell us?

I’m not alone in thinking about this. A friend responsible for integrated leave management at a Seattle-area employer with outdoor workers said that, when the smoke engulfs her city, she wonders if respirators will become standard outdoor-worker safety gear.

This is not a cheerful topic to ponder. And with legacy claims, opioid addiction and other more immediate, pressing challenges, workers’ comp claims managers are probably too busy to ponder an unmeasurable environmental harm.

If there is any way to protect workers — perhaps schedule more work indoors when possible — it would be a smart safety practice to do so. &

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

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But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

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Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]