Industry Pulse

Bombings, Shootings, Vehicular Homicide. Yet People Believe the World is Less Risky.

Travelers examined how executives perceive risk. Many think the world is getting less risky.
By: | December 14, 2017 • 4 min read

In the last year alone, violence broke out in hundreds of cities across the world, from Las Vegas to Myanmar, Sutherland Springs to Mogadishu. Hurricanes and wildfires tore through neighborhoods in August, September and October, leaving residential and corporate destruction in their wake.

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Yet survey results show that many American business owners and executives don’t believe that the world is getting more risky.

“We saw that both consumers and businesses are feeling more optimistic about their risk outlook,” said Pat Gee, a senior vice president with Travelers.

“This may mean that there is decreasing concern about economic uncertainty due to a gradually-improving economy over the past several years.”

Every year, Travelers surveys business owners and executives on their overall perception of risk in the world. This year, 37 percent of respondents said the world is getting riskier, down from last year’s 41 percent.

In 2014, when Travelers first began the annual survey, 48 percent believed the world was getting riskier.

But while perceptions of an increasingly risky world declined each year, business owners and execs still have concerns for the future.

Pat Gee, senior vice president, Travelers

Medical cost inflation tops that list, with 61 percent of respondents answering they worry some or a great deal that it affects their business.

This, said Gee, isn’t a surprising result; it is consistent with what business owners and executives have said since Travelers first conducted the survey.

Cyber threats followed next at 56 percent, then legal liability, retaining a talented workforce and complying with government laws.

When it comes to talent, business leaders in midsized and larger companies are most concerned with finding qualified workers and keeping them in a competitive labor market. The risk of having an aging workforce coupled with an influx of new and younger workers led many to cite this as the riskiest emerging trend, more likely to be a future business risk than an opportunity.

Thirty-eight percent of respondents said that the changing future workforce posed a great risk to their business in the next five years.

Others named emerging trends including e-business, social media and increased connectivity. Business owners believe increased use of digital platforms and the ability to connect with anyone at any time will contribute the most opportunity in the next five years.

But increased use of digital platforms opens businesses to cyber threats, too.

“Cyber risks continue to be a worry for businesses overall. Yet according to our Risk Index, only 22 percent of businesses have a cyber-breach response plan,” said Gee.

“Cyber criminals are getting smarter and more creative about how to steal information from companies,” he added.

“Business leaders need to consider not only what they can do to avoid these incidents, but also the available safety nets for the company should a cyber event occur.”

Thirty-eight percent of respondents said that the changing future workforce posed a great risk to their business in the next five years.

The best practice, Gee added, would be to require regular password updates for employees. These passwords should be complex in nature.

“Employees with unsophisticated passwords leave their computers and accounts — and therefore, the company — vulnerable to attack.”

Other risks measured by Travelers include distracted driving, workplace harassment, emerging technologies, extreme weather and employee safety. The study also broke down business owners’ and executives’ perceived risks by industry, from health care to banking, real estate to manufacturing.

Cyber remained a reoccurring top risk in all industries.

Consumer Concerns

In addition to surveying executives, Travelers asked consumers about their perception of world risks.

Much like businesses, some consumers feel that the world is getting less risky. Fifty-two percent of consumer respondents said the world is getting riskier, compared to last year’s 56 percent.

But consumers, too, had their own list of concerns.

Finances ranked highest. Sixty-four percent of respondents said not having enough money to pay expenses, live without debt or be able to retire was their biggest concern.

Cyber threats, identity theft, personal safety concerns and travel risks also were among the top five named by consumers.

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Of note, the survey found a disparity in how millennials and non-millennials view the practice of distracted driving.

Forty percent of millennials worry about getting into an automobile accident due to their own cell phone distractions, while 27 percent of non-millennials worry about their own cell phone use while driving.

“No matter the perception, the epidemic of distracted driving affects us all,” said Gee.

“We’re encouraging all businesses to consider implementing a distracted driving policy, but especially businesses with employees that drive as part of their job duties.”

Travelers launched an educational initiative called “Every Second Matters” to combat distracted driving.

“To be effective, business leaders should make it clear to employees that safety comes first, and they should not make or answer any work-related communications while driving,”    added Gee.

The survey report, “2017 Travelers Risk Index,” is available to view online. The full report dives deeper into the concerns raised by both consumers and business executives.  &

Autumn Heisler is the digital producer and a staff writer at Risk & Insurance®. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]