Public Risk September 2014 by Moire Marketing Partners

Published by the Public Risk Management Association

www.primacentral.org

SEPTEMBER 2014

Student Accident Insurance: A Small Premium to Pay to Help Prevent Bigger Liabilities

METRICS FOR IMPROVED CLAIM OUTCOMES DOMESTIC VIOLENCE AND STALKING IN THE WORKPLACE

Going Above and Beyond “Sometimes I have to go above and beyond—literally. “Traveling the Alaskan bush to over 150 cities, boroughs and school districts is daunting, but I love what I do. Helping our members is hugely rewarding. They aren’t just risk partners, they’ve become personal friends. “To protect them from risk and losses, we rely on Genesis for reinsurance. When we encounter a little turbulence — or worse— it’s comforting to know we can trust their specialized expertise and top notch security. “With Genesis, we can always count on safe landings no matter what risks cross our path.”

Visit our website at www.GenesisInsurance.com

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Volume 30, No. 8 | September 2014 | www.primacentral.org

The Public Risk Management Association promotes effective risk management in the public interest as an essential component of public administration. PRESIDENT Regan Rychetsky, ABCP Director, HHS Enterprise Risk Management and Safety Texas Health and Human Services Commission Austin, TX

CONTENTS

PAST PRESIDENT Betty Coulter Director of Risk Management and Insurance University of North Carolina at Charlotte Charlotte, NC PRESIDENT-ELECT Dean Coughenour, ARM Risk Manager City of Flagstaff Flagstaff, AZ

Terri Evans Risk Manager City of Kingsport Kingsport, TN

6 STUDENT ACCIDENT INSURANCE:

A Small Premium to Pay to Help Prevent Bigger Liabilities

By Nate Walker

DIRECTORS Ed Beecher Risk Manager City of Pompano Beach Pompano Beach, FL

Scott Kramer Risk Manager Montgomery County Commission Montgomery, AL Amy Larson, Esq. Risk and Litigation Manager City of Bloomington Bloomington, MN

10 METRICS FOR IMPROVED CLAIM OUTCOMES

Scott Moss, MPA, CPCU, ARM, ERM, ALCM P/C Trust Director CIS Salem, OR

By Gary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLA

Tracy Seiler, ARM-P Director of Risk Management Services Texas Association of Counties Austin, TX

15 DOMESTIC VIOLENCE AND STALKING IN THE WORKPLACE

NON-VOTING DIRECTOR Marshall Davies, PhD Executive Director Public Rick Management Association Alexandria, VA

By Regan J. Rychetsky, ABCP

EDITOR Jennifer Ackerman, CAE Deputy Executive Director 703.253.1267 • jackerman@primacentral.org ADVERTISING Donna Stigler 888.814.0022 • donna@ahi-services.com Public Risk is published 10 times per year by the Public Risk Management Association, 700 S. Washington St., #218, Alexandria, VA 22314 tel: 703.528.7701 • fax: 703.739.0200 email: info@primacentral.org • Web site: www.primacentral.org Opinions and ideas expressed are not necessarily representative of the policies of PRIMA. Subscription rate: $140 per year. Back issue copies for members available for $7 each ($13 each for non-PRIMA members). All back issues are subject to availability. Apply to the editor for permission to reprint any part of the magazine.

IN EVERY ISSUE 4 News Briefs | 19 Advertiser Index | 20 Member Spotlight

SEPTEMBER 2014 | PUBLIC RISK

PRIMAtalk keeps getting better! Join a PRIMAtalk subgroup today!

Connect with risk managers who share similar responsibilities and face similar challenges by joining a PRIMAtalk subgroup. All PRIMAtalk subscribers can join special groups to further tailor learning and networking! PRIMAtalk members can now join any or all of the following groups: ➊ Disaster Recovery/Emergency Management ➋ ERM/ISO 31000 ➌ Human Resources ➍ Schools ➎ Workers’ Compensation

Visit primacentral.org to log into PRIMAtalk and tailor your PRIMAtalk messages to you!

Message from PRIMA President Regan Rychetsky, ABCP

CONFERENCE PLANNING WORK GETS UNDERWAY

t is September, and time to go back to the drawing board to plan the 2015 PRIMA Annual Conference. One of major responsibilities of the PRIMA Board of Directors and PRIMA staff is to plan this annual event. The beginning of that process starts with the ‘Call for Presentations” in May and culminates with the end of the conference. Over the three day conference in Long Beach, we offered more than 55 educational sessions in Benefits/Human Resources; ERM/Management/Leadership, Pools, Schools, Risk Control/Safety, Risk Financing/Insurance/SelfInsurance, Risk Management Administration and Workers’ Compensation; at least 12 planned networking opportunities; a golf tournament and a great after-hours event on the Queen Mary. A conference as large as the PRIMA Annual Conference takes a lot of planning, coordination and collaboration to be successful. This month, the Conference Planning Committee will begin this process and meet to discuss and determine the educational sessions for the PRIMA Annual Conference in Houston. The PRIMA Board of Directors, PRIMA staff and our Corporate Partners will review all submissions and complete the difficult process of rating each session proposal. The rating process ensures the crème de la crème reaches the conference agenda. As I stated in my acceptance speech and my first column, education is the bedrock of PRIMA, and my mission is to lead PRIMA forward to achieving our goal of being the primary

source for public risk management educational programs, products and services. This is essential for the continuity of a PRIMA that is visionary and relevant. Selection of educational sessions is one of the first steps in the long process of conference planning.

When the call for presentations

The chair of the 2015 Conference Planning Committee is Terri Evans, risk manager for the City of Kingsport, Tenn. Terri is organized, driven and committed and I have no doubt she will do a great job in this capacity. She has my upmost confidence!

comes out next

When the call for presentations comes out next May, I encourage you to submit an educational session proposal. Let our members hear of your great programs, listen to your lessons learned and gain from your best practices.

an educational

May, I encourage you to submit

session proposal. Let our members

Please thank our veterans and those currently serving our military forces.

hear of your great

Regards,

programs, listen to your lessons learned and gain

Regan J. Rychetsky, ABCP 2014–2015 PRIMA President Director, HHS Enterprise Risk Management and Safety Texas Health and Human Services Commission

from your best practices.

SEPTEMBER 2014 | PUBLIC RISK

News Briefs

NEWS

BRIEFS IN UNPRECEDENTED MOVE, ALASKA PAYS PENSION BILLS IN CASH Alaska, like local governments across the U.S., is grappling with the pension costs of its retired workers. Unlike other states, Alaska opened its purse and paid a quarter of the bill in cash, reports Bloomberg News. Moving to preserve the state’s top credit ratings, Republican Governor Sean Parnell signed legislation that takes the unprecedented step of tapping Alaska’s budgetreserve account to pay unfunded pension liabilities. It will pull $3 billion from the pool to reduce a $12 billion gap.

LOUISIANA PARISHES PLAN TO BUY OUT FLOOD PRONE HOMES The Terrebonne Parish (La.) government has a $4 million grant it’s using to buy nine storm-damaged or flood-prone homes throughout the parish. Lafourche Parish has a similar program, but only two households are participating.

Home to the nation’s third-largest onshore oil reserve, Alaska gets 90 percent of its operating budget from crude-production taxes and royalties. It’s been saving oil proceeds for decades for when the wells run dry. Alaska is just one of nine states with top scores from Moody’s Investors Service and Standard & Poor’s, and it’s seen how pension deficits have hurt the credit standing of states such as New Jersey and Illinois. “A year ago when I went to New York City and spoke with the rating agencies to make sure that we maintained our AAA financial credit rating on our bonds, they identified our unfunded pension liability as the single biggest risk,” Parnell said during a signing of the bill in Juneau.

Officials say that this program differs from FEMA purchase programs in that the parish isn’t required to keep and maintain land permanently. Pat Gordon, Terrebonne’s planning director, tells The Courier the price, schedules and potential buyers have not been determined yet. The purchased homes are in areas too low for pump stations to reliably keep dry. Homes below what Gordon calls “tail water elevation” are more susceptible to flooding. The project’s purpose is to provide relief for impacted families.

PUBLIC RISK | SEPTEMBER 2014

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FLORIDA CITY BANS SAGGING PANTS Don't get caught with your pants down below your waist on City of Ocala (Fla.) property. You could face up to a $500 fine and six months in jail, reports Ocala BannerStar.

Being ready to rescue isn’t what it used to be.

The Ocala City Council voted 4-0 to pass an ordinance that prohibits anyone on city property from wearing their pants two inches below their natural waist in a way that exposes underwear or bare buttocks. This is the second time Councilwoman Mary Rich requested the ordinance. In 2009, the ordinance died when none of the other council members would second the motion. Rich told Mayor Kent Guinn that one of his objections in 2009 was that it could lead to profiling but she said it would not be profiling because kids of both genders and all races offend. "It doesn't matter what color they are," Rich said. "They all wear their pants down." Guinn, who heads the Ocala Police Department, asked how an officer can measure if the pants were two inches below the waist if the person sees an officer and pulls up the pants. He said it is not like seat belts, which are either being worn or not. "We are not looking to charge people," City Attorney Patrick Gilligan said. "If they don't comply, I think the chief will tell police officers to take your phone out and take a picture." He said the judge can look at the picture and make a decision. The offense would be a second-degree misdemeanor. "If it's a close call, they get acquitted," Gilligan said.

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AED Authority is a worldwide distributor of Automated External Defibrillators and management solutions. Call for your free program consultation today.

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SEPTEMBER 2014 | PUBLIC RISK

Student Accident Insurance: A Small Premium to Pay to Help Prevent Bigger Liabilities By Nate Walker

rom skinned knees to broken bones, kids are no strangers to accidents. Emergency room visits for kids happen far more often than we’d like to think about, whether as a result of reckless behavior or if a child is just having a bad day. No matter how it happens or where students are hurt while on school property, schools are liable for the cost of student injuries and need to be prepared for these sometimes devastating expenses. Risk managers and insurance buyers understand that accidents happen during school and extracurricular activities, from kindergarten through the end of high school. The types of accidents vary in frequency and severity. Think of the many incidents that can occur on a public entity’s watch: • A pre-teen municipal recreation league soccer player bangs knees with an opponent, resulting in an undetermined knee injury. • A nine-year-old cuts her leg on a piece of jagged metal protruding from public playground equipment and requires three stitches. • A high school junior fools around on a rope in gym class before the bell rings, and then falls awkwardly on his neck as the gym teacher’s arrival surprises him. While these incidents are hypothetical, student accidents are vividly real to public organizations across the country. More than 1.35 million children each year incur a sports-related injury requiring emergency room treatment at an estimated $935 million, according to Safe Kids Worldwide.1 Annually, about 3.5 million children ages 14 and younger are injured playing sports or participating in recreational activities.2

PUBLIC RISK | SEPTEMBER 2014

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A basic student accident insurance program can provide a school with the protection they need when these incidents occur. Unlike many insurance products where risk managers may think a certain situation will “never happen to them,” student injuries are frequent and inevitable. The reality is that kids get hurt, and even the most aggressive risk management program in the world can't prevent all injuries. Most student accidents take the form of bumps and sprains, but a more serious injury can be significantly more expensive and complicated. For many public entities, having a comprehensive risk financing program in place is a necessity, providing both financial protection and peace of mind for all involved. Whether insuring risks through commercial markets, captive insurance or self-insurance, public entities will find that student accident insurance is a major component of a comprehensive risk financing program that can minimize out-of-pocket expenses and limit possible litigation from injuries that fall outside liability coverage.

A PRODUCT FOR TODAY’S RISK ENVIRONMENT In today’s rapidly changing health insurance landscape, many Americans struggle with healthcare costs. They may not have health insurance, regardless of the Affordable Care Act’s requirement that most individuals have coverage, or they may be underinsured, forcing them to pay high out-ofpocket costs. Two situations, but a similar challenge: how to pay for most of an injured child’s healthcare costs. When families don’t have health insurance, every dollar they must pay for a child’s healthcare needs, however minor, can potentially create a financial burden. Without

financial relief, the tendency to bring contentious legal action against the organization responsible for the child’s welfare grows stronger. However, when a public entity has a comprehensive student accident insurance policy, injured and uninsured students and their families are provided with some relief, as it can serve as primary insurance. This coverage can also help to demonstrate good will and can discourage families from making legal mountains out of small injury molehills.

When families don’t

Student accident insurance plans play a crucial role in the insurance programs of many public entities. While these plans are not supplemental health insurance, they provide a much needed financial benefit to compensate for a family’s out-of-pocket healthcare costs. The insurance can also double as an organization’s first line of defense for general liability claims.

potentially create

have health insurance, every dollar they must pay for a child’s healthcare needs, however minor, can

a financial burden. Without financial relief, the tendency to bring contentious

However, healthcare costs squeeze more than the uninsured. Out-of-pocket costs continue to soar, as deductibles, copayments and coinsurance increase—not to mention premiums. To illustrate this point, worker contributions to employer-sponsored healthcare almost doubled to more than $4,500 from 2003 through 2013.3 And public sector employers are also beginning to shift some of their healthcare insurance costs to employees.

legal action against the organization responsible for the child’s welfare grows stronger.

In a situation where a family is struggling to meet rising healthcare costs with less-than-comprehensive health insurance, student accident insurance serves as secondary insurance, taking the sting out of injury-related out-ofpocket costs. Premiums are affordable for public entities and can provide a deductible-free financial benefit for families. The comfort this coverage gives parents helps lessen the urge to take legal action.

SEPTEMBER 2014 | PUBLIC RISK

Student Accident Insurance

FOOTNOTES 1 http://www.usatoday. com/story/news/ nation/2013/08/06/ injuries-athletes-kidssports/2612429/ 2 http://www.urmc.rochester. edu/Encyclopedia/Content. aspx?ContentTypeID=90&Co ntentID=P01650 3 http://kff.org/reportsection/2013-summary-offindings/

Combining policies to provide the most protection While the majority of student accidents are minor, some are much more serious. They can involve concussions and spinal injuries, which may require treatment for extended time periods or even a lifetime. Others, such as knee surgery, typically have predictable outcomes but can include costs from the thousands to tens of thousands of dollars. While organizations regularly deal with minor to moderate injuries, even the most experienced risk managers feel their hearts drop to their stomachs when a football player or gymnast suffers a potential spinal injury and is carted away in a neck brace on a stretcher. Cost is the last thing anyone thinks of during these times; however, the cost of a major injury and possible liability exposure can cripple an organization that doesn’t plan for all scenarios. The combination of student accident insurance to provide benefits for everyday injuries and catastrophic accident coverage to deal with the most severe student injuries can help ensure public entities own top-to-bottom coverage. With benefit limits that range as high as $6 million per incident, high-limit student accident insurance helps protect public and private organizations from catastrophic costs by providing a second layer of protection.

Public Entity Program Midlands is the exclusive manager for individual public entity risks that prefer to self-insure their exposures and stands ready to provide a stable, cost effective coverage.

Target Classes

Limits

• Municipalities

• Casualty Line Limits: $5M/$5M

• Counties

• Property Lines Limits: $2M

• School Districts

• Basket Aggregate Coverage: $1M

• Special Districts

Understanding the need isn’t a problem today in the public sector. Jurisdictions, including Illinois and Florida, mandate a certain level of accident coverage from grades nine through 12. However, few public organizations are as big as these states, nor do they always have in-house risk management expertise. For these public entities, finding the right insurance partner is crucial and can prove invaluable over time. Every public organization is different, and student accident insurance, much like students themselves, does not come in a one-size-fits-all package. The best course of action is to work with your insurance broker to determine what’s right for you and design a program that fits your exact needs. In doing so, it’s possible to tailor your benefit periods and limits in a way that works best for your organization, whether this component of your program provides primary, secondary or excess coverage. Accidents can happen anywhere and anytime in primary schools, secondary schools, day care centers, afterschool programs, nonprofit sporting clubs, municipal facilities and at extracurricular activities. Because student accidents are frequent and sometimes severe, risk managers need to constantly monitor and keep track of injuries and measure their costs in order to reduce potential exposures. These exposures may result in injuries with negligible costs, but an injury could just as easily involve higher costs for everyone involved, including families, and could quickly escalate to the courtroom level. Once risk managers understand and have a clear picture of their potential liabilities, they need to work to prevent student accidents where they can and make sure they are protected against the inevitable. Typically small in premium, the benefits can mean everything to families of injured students and to public organizations responsible for children’s welfare. Nate Walker is a senior sales executive, Special Markets Insurance Consultants, a division of AmWINS Group Benefits.

Minimum Self-Insured Retentions

• Housing Authorities

• All Property & Casualty Lines: $100K

• Transit Districts

• Workers’ Compensation Buffer: $500K

• Community Colleges

CRAFTING THE RIGHT PROGRAM

Minimum Premium: $150K publicentity@midman.com 800.800.4007 midlandsmgt.com

PUBLIC RISK | SEPTEMBER 2014

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An n elevated perspective, focused on service. With in-depth knowledge comes perspective. At Travelers, we understand the evolving coverage trends and service needs unique to public entities. Our suite of products combines customized coverages and dedicated support based on the specific exposures you face every day – from our expertise in state-specific tort caps and immunities, to our law enforcement and cyber liability coverages. Additionally, Travelers offers public entities value-added features that go beyond the coverage, including: • •

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Get protection beyond the policy. Contact your agent and ask about Travelers.

travelers.com The Travelers Indemnity Company and its property casualty affiliates. One Tower Square, Hartford, CT 06183 This material is for informational purposes only. All statements herein are subject to the provisions, exclusions and conditions of the applicable policy. For an actual description of all coverages, terms and conditions, refer to the insurance policy. Coverages are subject to individual insureds meeting our underwriting qualifications and to state availability. © 2014 The Travelers Indemnity Company. All rights reserved. Travelers and the Travelers Umbrella logo are registered trademarks of The Travelers Indemnity Company in the U.S. and other countries. CP-7627 Rev. 3.14

METRICS FOR IMPROVED CLAIM OUTCOMES

By Gary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLA

ne of the most difficult things to do is to measure the condition of your claims program. The metrics needed to measure the condition and change in your claims program require you to:

➊ Know where you are ➋ Decide where you want to go, and ➌ Determine if and when you get to your desired destination or results

We have found that public entities and risk pools often have limited information to help them manage their programs more efficiently and effectively. The current economic environment provides many additional challenges for public entities. Most entities have experienced revenue reductions due to reduced taxes and federal monies, while losing none of the risk exposures that they have always had. They have fewer personnel to perform the many responsibilities required to reduce or control risks, such as continuing strong maintenance programs, and they often have fewer risk management, claims, and safety / loss control personnel. The metrics that public entities should capture will help them to make judgments about the performance of the claims staff or TPA, and can also help to identify troubling trends or hot spots with their departments or members that should be addressed promptly. They can also help them organize their program so they can spend their limited resources on the areas where they will gain the greatest return on investment. These metrics should be used regardless of whether your claims are administered by a third-party administrator

PUBLIC RISK | SEPTEMBER 2014

(TPA) or whether you are one of the many selfadministered public entities/risk pools. Leading claims industry practices apply regardless of the program type, and there should be no difference between the ways that public entities manage claims and the ways that insurers and TPAs manage them. Furthermore, the claims staff should be clear on the actions they should take and the more favorable outcomes that their targeted directions and actions should create. We recognize that many public entities have statutory or administrative requirements that claims must be reported through specific channels or departments within a specific period of time, and that claims may not be “officially” presented unless these requirements are met. We recognize these requirements, but believe that the same general functions and activities that have been identified by the insurance industry as leading industry practices should also apply to public entities. The metrics, however, may need some clarifications and adjustments to fit the reporting requirements and leading industry practices into the appropriate framework.

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The metrics that public entities should capture will help them to make judgments about the performance of the claims staff or TPA, and can also help to identify troubling trends or hot spots with their departments or members that should be addressed promptly.

WHAT METRICS SHOULD WE USE? The metrics that you should use will first depend upon the insurance line. This is due to the fact that it is more appropriate to measure some insurance lines or incident types on short-term results, while other lines require both short-term results measurements which primarily measure activities, while the financial results may require a more intermediate or long-term view. The following chart describes some of the differences: LINES OF BUSINESS / CLAIM TYPES

REASONS

SHORT-TERM OR “SHORT TAIL”

MEASUREMENT “TERM”

• Property (building and contents), • Automobile physical damage (collision, comprehensive vehicle claim) • Auto liability property damage • Workers’ compensation (WC) medical only

Claims are “short tail” in nature. Many TPAs refer to these as “fast track” claims. Claims can typically be processed, paid, and closed within 30-to-45 days of receipt, and there is less variation in outcomes due to more concrete measurements, such as: • Building repair estimates and repair costs • Contents valuations (ACV and RC) • Vehicle appraisals and repairs • Medical bills per fee schedule or UCR

INTERMEDIATE

These are claims that last longer than the “fast track” claims but have a more finite beginning and end, and do not continue for months or years as the long-term or “long tail” claims.

LONG-TERM OR “LONG TAIL”

• Property with extensive damage, long-term rebuilding, business interruption / revenue loss, necessity to relocate • Auto liability bodily injury • Workers’ compensation lost time • Employment liability • Public officials liability • Wrongful arrest / police actions • Land use • Defective roadway design • Litigated claims • Other claims that take longer to resolve

Claims in which the ultimate outcomes are more difficult to ascertain, and may require numerous reserve revisions over a long period of time due to changing and more unpredictable circumstances such as: • Extensive repairs • Longer periods of medical treatment and disability than expected • Increased legal representation and litigation • Complex issues regarding loss causes, multiple parties involved, defenses, coverage, etc.

Therefore the metrics you should use will vary depending upon the claim type and the outcomes you are seeking. However, there are some general metrics that apply regardless of the claim type, since they measure the current state of your organization and staffing, as well as the timeliness required to accomplish certain activities. The following lists include a few of the metrics that your organization can incorporate. This list, which is by no means exhaustive, defines some of the metrics that will help you manage your program more effectively. The article will also describe their application to different insurance lines and the benefits that these metrics will create that should lead to improved outcomes.

SEPTEMBER 2014 | PUBLIC RISK

Metrics for Improved Claim Outcomes

METRIC INTENDED FOR

METRIC ELEMENTS

BENEFITS

ALL CLAIMS – GENERAL METRICS

• Claims staff claim counts – new claims and pending caseloads • Timeliness of departments’ or members’ claim reporting • Promptness of claim set-up and assignment after claim received • Promptness of initial contact with departments / members, employees / claimants, medical providers (WC claims). • Promptness of starting and concluding investigation

• Confirms that claim assignments are based on the loss and adjusters’ training, experience, and expertise – puts the people at the right place for optimal handling • Confirms that claim assignments are reasonable and equitable, providing adjusters with sufficient time to manage claims as they should • Measures the timelines of incident or claim reporting, since delays often lead to greater costs • Ensures that prompt contact and investigation occur, which results in an earlier resolution of issues arising out of the incident through better control and communication.

SHORT TERM – PROPERTY (BUILDING & CONTENTS)

• Average paid claim • Interval or lag time between initial contact and field inspection and/or estimate completion • Average adjusting costs (independent adjusters / appraisers) • Time from claim receipt to closure

• Quick measures are available to compare recent results with recent periods, allowing senior management to move more quickly when needed • Increases / decreases in ALAE can dictate whether to outsource more work or keep more in-house for the best outcomes and expense management • Quick adjustments can be made to reduce loss costs and allocated expenses • Identifies inefficient processes that prevent prompt resolution

SHORT TERM – AUTO PHYS DAMAGE & PROPERTY DAMAGE

• Quick measures are available to compare recent results with recent months, quarter, and YTD data, allowing senior management to move more quickly when needed • Increases or decreases in ALAE can dictate whether to outsource more work or keep more in-house for the best outcomes and expense management • Quick adjustments can be made to reduce loss costs and allocated expenses • Identifies inefficient processes that prevent prompt resolution

SHORT TERM – WC MED ONLY

• Average paid claim • Medical bill review savings • PPO penetration %

• Trending medical costs can be noted to determine if medical providers are cost-effective while providing excellent care • Determine if some procedures are being used excessively and the reasonable alternatives that might exist • Increase referrals to PPO medical providers when possible

LONG TERM – PROPERTY – SIGNIFICANT LOSSES

• Average indemnity cost (by claim type, body part and/ or some basis to compare similar claims • Allocated expenses as % of total incurred cost • Recoveries (subrogation , contribution, excess) • Supplemental estimates and payments as a ratio to ultimate payout

• Identifies some properties that should be underwritten differently • Identifies exposures of which the entity was previously unaware • Control adjusting expenses (e.g., independent adjusters) versus using in-house resources • Identify the types of recovery pursuits that are successful, which may not be known for a long period after the claim is paid. • Identify inaccurate or incomplete estimate procedures

LONG TERM – LIABILITY / BODILY INJURY

• Average paid claim by claim type, body part, and other factors • Average allocated loss adjustment expenses (ALAE), preferably broken out by defense costs, adjusting costs, experts, and other categories • ALAE as a % of total incurred costs • Reserve development / Incurred But Not Reported (IBNR) Values

• Identify areas for loss control services • Identify ineffective reserving procedures and practices • Identifies vendors that are optimal for the needed services

LONG TERM – WC LOST TIME

• Average paid claim by claim type, body part, and other factors • Medical costs as % of total costs • Average indemnity period (by body part, ICD code, injury type, injury cause, injury source) • Reserve development / Incurred But Not Reported (IBNR) Values

• Identify areas for loss control services • Identify ineffective reserving procedures and practices • Identifies vendors that are optimal for the needed

INTERMEDIATE

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WHAT IF OUR SYSTEM CAN’T CAPTURE THIS INFORMATION? In a few cases, you may have the luxury of an updated Risk Management Information System (RMIS) that will capture much or all of the desired information. However, experience tells us that most public entities lack the ability to capture some or many of the fields necessary to measure performance as they should. While you may not be able to measure all the elements that you would like, developing a list of needed or wanted metrics will help to: • Determine if there are fields or reports that are already available to you that you haven’t used or that you haven’t requested from your TPA or RMIS vendor • Ensure that the adjusters and supervisors, whether in a self-administered program or a TPA, capture and input the needed information into the required fields • Work with your RMIS vendor and/or TPA to build on the existing system and create new fields and reports for future use • Create a case for obtaining an improved RMIS that will help the public entity with its future loss control, claims management, and financial management goals.

• Identify the needs and qualities desired when you have an opportunity, at some point in the future, to negotiate with TPAs or buy or lease a RMIS for your public entity

CONCLUSION Some of the metrics described in this article will help you to determine your entity’s current state, and some of the measurements that you should capture to measure your progress along the way. These measurements are also important so that your departments or members can measure their programs and progress, and how they stack up against similar organizations. The metrics can create a motivational environment if some departments or members do not measure up to their peers, and can also provide a basis for kudos for those that have taken the big step to try to overcome the limitations imposed upon them, provide improved service to their citizens and/or employees, and reduce claims costs and expenses so that those insurance dollars can be better spent on the many needs that public entities have today. Gary Jennings is a principal with Strategic Claims Direction LLC.

Berkley Public Entity Managers Berkley Public Entity Managers provides self-insured individual public entities and risk-sharing inter-governmental groups superior service and access to A.M. Best rated A+ (Superior) Financial Size Category XV paper. We are an integrated team that includes underwriting, actuarial, risk control and claims. Together we are focused on one goal – to provide the protection our clients deserve through a combination of prevention, management and coverage. Have your Broker call us for flexible collaboratively developed Risk Solutions. For more information, please contact: Berkley Public Entity Managers 30 South 17th Street, Suite 820 Philadelphia, PA 19103

Richard B. Vincelette President T: (215) 553 7366 C: (215) 528 0410 rvincelette@wrberkley.com

Brian T. Whooley Sr. Vice President, Underwriting T: (215) 553 7381 C: (215) 528 0374 bwhooley@wrberkley.com

Products and services are provided by one or more insurance company subsidiaries of W. R. Berkley Corporation. Not all products and services are available in every jurisdiction, and the precise coverage afforded by any insurer is subject to the actual terms and conditions of the policies as issued. Certain coverages may be provided through surplus lines insurance company subsidiaries of W. R. Berkley Corporation through licensed surplus lines brokers. Surplus lines insurers do not generally participate in state guaranty funds and insureds are therefore not protected by such funds. © Copyright 2014 Berkley Public Entity Managers – A W. R. Berkley Company. All rights reserved.

SEPTEMBER 2014 | PUBLIC RISK

INDUSTRY-LEADING CONTENT PROVIDERS HANDS-ON LEARNING SMALL GROUP SETTING LEARNING AT YOUR LEVEL NETWORKING OPPORTUNITIES

PRIMA Institute 2014 is the premier education program for public risk managers, human resources professionals, employee benefits coordinators, those working in claims, underwriting or insurance departments and anyone looking to learn more about the public risk management industry. PI 14 brings together outstanding faculty and an intense, comprehensive risk management foundations program. The only education event of its kind, PI 14 has something for newer risk managers and the seasoned risk professional looking to learn about emerging trends and best practices.

November 3–7, 2014 • Louisville, KY

The Industry’s Premier Risk Management Training Program 14

PUBLIC RISK | SEPTEMBER 2014

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By Regan J. Rychetsky, ABCP

SEPTEMBER 2014 | PUBLIC RISK

Domestic Violence and Stalking in the Workplace

omestic violence and stalking are two of the most underreported crimes according to the Federal Bureau of Investigation. One in four women killed at work is murdered by their current or former partner. The U.S. Department of Justice estimates 6 million people are victims of stalking every year. Public entities carry a serious liability risk if they ignore domestic violence or stalking as a workplace issue, and will pay through higher health care, lower productivity and absenteeism. Chances are very good that you will know someone in your workplace that is or has been a victim of domestic violence or stalking.

DID YOU KNOW? • 6.6 million people are stalked every year in the U.S. • 1 in 6 women and 1 in 19 men have experienced stalking. • Majority of stalking victims are stalked by someone they know. • 66 percent of female victims and 41 percent of male victims of stalking are stalked by a current or former intimate partner. • >50 percent of female and >33 percent of male victims were stalked before age 25. • 1 in 5 female victims and 1 in 14 male victims experienced stalking between the ages of 11 and 17. Stalking Resource Center and U.S. Department of Justice

WHAT IS DOMESTIC VIOLENCE? Domestic violence is a pattern of coercive behavior that is used by one person to gain power and control over their current or former partner; and may include physical violence, sexual, emotional and psychological intimidation, verbal abuse, stalking, and economic control. Domestic violence is about power and control; NOT love, anger, addiction problems or financial matters. Although these are factors that may intensify the effects of domestic violence, they are not the reason a batterer attacks his victim. Domestic violence is a crime and takes the lives of women and men every year… and to compound the situation, more law officers are killed in the line of duty responding to a domestic violence situation, than any other call. I am not a licensed expert in domestic violence, but this is what I have learned over the last 15 years of meeting with employees and drafting personal safety plans for employees.

WHO ARE THE MOST LIKELY VICTIMS? Domestic violence occurs between people of all racial, economic, educational and religious backgrounds; in heterosexual and same sex relationships, living together or separately, married or unmarried, in short term or long term relationships. Domestic violence has no socio-economic boundaries. A batterer or victim may be a doctor, lawyer, judge, police officer, firefighter, refuse truck driver, custodian, or risk manager. Domestic violence is not an isolated event, but a pattern of behavior used against their current or former partner that entails a variety of abuses occurring throughout the relationship. One form of abuse builds on past behaviors and sets the stage for future episodes.

FORMS OF DOMESTIC VIOLENCE • Physical abuse – includes assault, rape, broken bones, bruises and all forms of external and internal physical injury. • Psychological abuse – include threats of violence and harm (workplace), attacks against pets or property,

PUBLIC RISK | SEPTEMBER 2014

stalking, discrediting victim’s reputation and damaging her relationship with others. Includes the following: • Emotional Abuse – wide variety of verbal attacks and humiliations, often emphasizing the victim’s vulnerabilities (family, friends or strangers). Used to maintain POWER and CONTROL. • Isolation – cuts off victim from support networks (family, friends, etc.) with claims of interfering. Prevents discovery of abuse. • Economic Control – controls victim’s access to family resources: transportation, food, clothing, shelter, insurance and money. Does not matter that the primary provider is the victim; the perpetrator controls the finances.

WHY IS DOMESTIC VIOLENCE IMPORTANT FOR EMPLOYERS? Since we work better with statistics, here are some additional domestic violence statistics. • Leading cause of injury to a woman, more than motor vehicle accidents, muggings and rapes…combined. • Annually in the U.S., more than 500,000 women are stalked by an intimate partner. • 1 out of 4 workplace homicides are a result of domestic violence coming to the workplace. • Intimate partner homicides account for and estimated 33.5 percent of the murders of women and 4 percent of the murders of men Keep in mind that the batterer does not have control of his current or former partner in the workplace. If the batterer is unsure of his victim’s whereabouts outside of work hours, he knows for sure where she is during work hours. He will make attempts to contact her at work, and most likely come to the office or call her to intimidate and threaten her. The reality of the employers’ situation is that he knows where his “reason for existence” is located from 8-10 hours every day, regardless of whether the employee has been living in a location unknown to the perpetrator. A batterer will call your

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employee constantly on either her work phone or cell phone asking questions like, “I called the line was busy. Who are you talking to?”; “You were not at your desk when I called...where were you?”; “Who are you going to lunch with?”; and the list goes on. This will eventually make it impossible for the employee to be productive. You will notice increase absenteeism, lower production and/or a work product that is not consistent with what she has produced in the past. Some employees will physically be unable to come in to work. If an employee notifies you that their current or former partner has threatened to come to the workplace and “take care of her,” “make her pay” or “kill her,” the employer must take action to mitigate the risk of a serious incident from occurring. If a violent incident occurs at work and the employee had previously informed you of the threats and intentions of her current or former partner, you expose your employees to a grave security and safety risks, and your entity to greater liability if you do not take action. Let employees know of resources available to those who are victims of domestic violence. This is a workplace issue, and chances are one of your employees is in this situation and looking for help.

CALENDAR OF EVENTS PRIMA’s calendar of events is current at time of publication. For the most up-to-date schedule, visit www.primacentral.org.

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STALKING IN THE WORKPLACE An employee walks out to their car to go to lunch and finds a note on the windshield under the wiper blade. She reads the note that says, “You are the most beautiful woman I have ever seen.” signed, Secret Admirer. Weeks before, she was walking into the building and a person she had never seen before was standing against the wall inside the door. When she enters the building the man says, “Good morning. I just want to tell you that you are the most beautiful girl I have ever seen.” and steps away from the wall. She continues by and says, “Thanks!”, gets on the elevator and goes to her office. Two weeks later, the same individual is in the foyer in the building when she comes in for work and, again, says, “Good morning! I just want to tell you that you are the most beautiful girl I have ever seen. What’s your name?” She tells him. “Do you work here?” Her reply, “Yes!”; What floor do you work on?” She is now sufficiently concerned and gets on the elevator. She does not see him for two weeks and then finds the note. What does this tell you? He has been conducting surveillance of her to know what vehicle she drives. How long has he known? How long has the surveillance been ongoing? What can we do as an employer, if anything?

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WHAT IS STALKING? There are many legal definitions of stalking, but according to the Stalking Resource Center, a good working definition of stalking is a course of conduct directed at a specific person that would cause a reasonable person to feel fear. Stalking is serious, may result in violence, and can escalate over time.

STALKING RESOURCE CENTER AND U.S. DEPARTMENT OF JUSTICE

OTHER MEETINGS November 3-7 PRIMA Institute 2014 Louisville, KY

Below are a few stalking behaviors to consider with drafting a safety plan for an employee. A stalker will: • • • • • • • •

Follow you and show up wherever you are Send unwanted gifts, letters, cards, or emails Damage your home, car, or other property Monitor your phone calls or computer use Use technology, like hidden cameras or global positioning systems (GPS), to track where you go Drive by or hang out at your home, school, or work Threaten to hurt you, your family, friends, or pets Research you using public records or online search services, hiring investigators, going through your garbage, or contacting friends, family, neighbors, or co-workers • Posting information or spreading rumors about you on the Internet, in a public place, or by word of mouth • Other actions that control, track, or frighten you

SEPTEMBER 2014 | PUBLIC RISK

Domestic Violence and Stalking in the Workplace Stalking is a scary situation for the person being stalked. When the victim reports the incidents to law enforcement, they can get mixed results if documentation is lacking, and end up frustrated with the system. At work, an employee may not know who to report the information to and what will be done if they do report the matter. A stalker is a Ph.D. in surveillance, and knows all the habits, routines, parking spots, favorite shopping areas, eateries and of course, where they work. The stalker could be someone she/he knows, former client, former employee, stranger or even someone that was part of a project team of employees of different companies/entities.

WHAT CAN WE DO AS EMPLOYERS? If you have an employee who believes they are being stalked, recommend they document all incidents including date, time, method of contact, language used, etc. Also save any gifts, packages, cards and letters from the stalker to give to law enforcement. All 50 states have stalking laws. Become familiar with your stateâ&#x20AC;&#x2122;s stalking statute and assist your employee to ensure they follow the necessary steps to file a stalking case in accordance with the statute. Order of Protection? Maybe, but take these on a case-by-case basis. Like domestic violence, an Reduce the device shape to the required size, then make a new clipping mask. Order of Protection may not be the best move in all cases.

Employers should draft policies addressing threats in the workplace and roll out awareness programs to change the internal culture by implementing a reporting process for all security incidentsâ&#x20AC;Śthreats, thefts, vandalism, bomb threats, assaults, etc., and make your employees aware of the process; provide personal safety planning for employees in threatening situations; provide safety/ security planning for the location the employee is officed; and follow through with your promised actions. Let you employees know you care and that they are not alone in this situation. Offer resources and assistance. Here are a couple of very good resources: 1. The National Domestic Violence Hotline at 1-800-799-SAFE (7233); TTY: 1-800-787-3224 2. Stalking Resource Center http://www.victimsofcrime. org/our-programs/stalking-resource-center Regan J. Rychetsky is the director, HHS Enterprise Risk Management and Safety, for the Texas Health and Human Services Commission. He is a frequent speaker and trainer regarding threats in the workplace and how employers can improve their processes to provide internal resources to their employees.

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SEPTEMBER 2014 | PUBLIC RISK

Member Spotlight

MCIT REDUCES SLIPS, TRIP & FALLS Each month, Public Risk features a member who has gone above and beyond in a feature column titled “Member Spotlight.” Do you know someone who deserves recognition, has made a contribution or excelled in their profession? If so, we’d like to hear from you for this exciting column, as PRIMA shines the spotlight on its members. To be considered for the Member Spotlight column, contact Jennifer Ackerman at jackerman@primacentral.org or 703.253.1267.

laims related to slips, trips and falls are some of the most common that Minnesota Counties Intergovernmental Trust (MCIT) receives from members, costing MCIT members an average of $2 million each year. Slips and falls account for about 25 percent of MCIT memberreported workers’ compensation claims. In 2012, slip, trip and fall claims represented 41 percent of all general liability claims reported from MCIT members and 50 percent of all general liability claim costs. Many of these accidents could be have been prevented or mitigated if employees and the public were aware of hazards and took precautions to avoid accidents, such as wearing proper footwear and cleaning up spills. As a result, MCIT undertook a year-long campaign to educate its members and their employees about accident prevention. Under the overall slogan, Step Wisely, MCIT created quarterly materials specific to the slip, trip and fall hazards of each season. MCIT members used the materials to educate and empower their employees and the public about accident prevention and safe work habits. Materials include wall posters, table tents, payroll stuffers, short training scripts, a Power Point training presentation, accident prevention handbook, checklist, informational articles and referrals to additional services and materials, such as online training and videos. “The frequency and aggregate severity of slip, trip and fall-related claims is significant for public entities,” said MCIT Executive Director Robyn Sykes. “Nationally, 25.3 percent of nonfatal workplace injuries and 14 percent of fatal workplace injuries are due to slips, trips and falls

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The Step Wisely campaign is built around the goal of reducing both the frequency and severity of slip, trip and fall injuries. The campaign uses the three general techniques of engineering, education and empowerment to meet these goals.

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PUBLIC RISK | SEPTEMBER 2014

according to the U.S. Bureau of Labor Statistics. The Step Wisely campaign is built around the goal of reducing both the frequency and severity of slip, trip and fall injuries. The campaign uses the three general techniques of engineering, education and empowerment to meet these goals.” Educating and empowering employees and the public are key steps to prevent slip, trip and fall accidents and to reduce the severity of any injuries that do occur. All of the Step Wisely materials educate entity employees (and as often as possible, the public) about the slip, trip and fall hazards they are likely to encounter on the job or at the public facility so they can avoid them. Additionally, the campaign empowers employees to take corrective action or immediately report conditions to the appropriate authority when employees cannot remedy hazards themselves. Slip, trip and fall prevention materials are common, but it is the approach and breadth of the Step Wisely campaign that sets it apart from others. “Safety information is sometimes presented using a tone that makes the employee/citizen feel as if he or she is being scolded. This can actually turn people off to the message,” Sykes said. “MCIT wanted member employees and citizens to be receptive to the campaign’s messages and follow through on them, so we decided to use humor as a strategy to convey our important safety message. We think the use of parody makes the messages memorable and increases the likelihood that employees/citizens will make safe choices.” In addition, each quarter MCIT developed a new theme (e.g., movie poster parodies) for the campaign as a way to renew employee and citizen interest. MCIT wanted to avoid people thinking they had already seen the materials and therefore ignore the new messages. For more information about MCIT’s slip, trip and fall prevention campaign, contact MCIT Communications Manager Heather Larson-Blakestad at hblakestad@mcit.org.

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