When it comes to insuring your business, health and safety can directly impact the cost of your premiums. From incident reporting and investigation to staff training and data handling, there are many ways that your overall safety culture could be costing you money.
Insurance companies are in the business of risk management. They want to see that an organisation is taking steps to implement effective health and safety practices to reduce the probability of workplace accidents. At the same time, it’s in the business owner’s interest to keep their working environment low-risk, not just for their employees safety but also to keep the cost of their insurance premiums down. Spending less on insurance means more money for investment, improvements or expansion. In short, it’s good for business.
So, how can you share the most comprehensive picture of your company’s health and safety culture with your insurer? We’ll look at five ways that health and safety software can provide an accurate insight into your workplace processes. With health and safety software, you can easily demonstrate employee engagement, provide a digital audit trail of reports and investigations, indicate good data handling and highlight where you have identified trends to prevent hazards from becoming incidents. These digital tools make it easier for insurers to see how effective your health and safety processes are. This creates greater transparency and can ultimately lower the cost of your business insurance.
Why do insurance companies care about your organisation’s health and safety?
Insurance companies know that the potential cost of a corporate claim could be significantly higher than that of a personal insurance claim. Put simply, insurance companies want to see that you are taking all the steps necessary to prevent incidents that might result in you making a claim, causing the insurance company to pay out.
According to the Association of British Insurers, £22 million is paid out in business insurance claims every day in the UK. This total has only increased since the COVID-19 pandemic. It’s little wonder that insurance companies have become increasingly forensic in their assessment of organisational health and safety to avoid these potentially huge pay-outs. This means that for some insurers, meeting minimum standards of safety compliance may no longer be enough. Certain insurers may even insist that companies agree on specific measures or take action to resolve identified hazards before an insurance premium is agreed on.
This level of scrutiny is ultimately beneficial for the organisation. Having the oversight of an external (and interested) party over a long period can encourage companies to regularly review and update their health and safety policies. This leads to a safer work environment and a more proactive health and safety culture among staff. In time, this action can lead to lower insurance costs, satisfying both the organisation and the insurer.
How do insurance companies evaluate the effectiveness of your existing health and safety practices?
We know that business insurance claims can carry a large financial impact. As a result, insurers will take an exacting approach to evaluating your existing health and safety processes. After all, it’s the insurer’s job to make an assessment that will reduce the chance of companies making a claim in the first place. So, what are insurance companies looking at when they are evaluating your existing health and safety practices?
First of all, insurers want to understand your organisation as a whole. They might look at management structure, staff turnover, business practice and even the history of your company. While your health and safety practices may be at the heart of their assessment, getting to know other areas of your business will help your insurer build a true picture of your organisation.
When it comes to your health and safety culture, insurers will consider all aspects of your workplace. As well as making sure your current policies comply with health and safety regulations, they will also look into your historic safety practices. They will consider the frequency of workplace incidents and how these were investigated and responded to. Any past claims will be taken into account, including what actions were taken to mitigate risk after a claim was made. How you process and store data around your safety practices will also be a key factor in determining the cost of your insurance premiums.
Employee engagement is also central to an insurer’s assessment of your business. How are your teams actively involved in shaping and carrying out health and safety processes? Insurers will look at what training your employees are offered, how easy it is for them to report incidents such as near misses, and how they kept involved/informed in investigations or follow-up action. Insurers know that good health and safety culture comes from organisation-wide action, so be prepared to demonstrate the ways that you are investing in employee safety engagement at all levels of your company.
How does your risk level impact your insurance premiums?
Leaders know there are risks to their business that are outside their control. These external risks vary from industry to industry, but will nonetheless have an impact on your risk level as a business. For example, a construction company with employees or contractors that work regularly at height and with large power tools, will be assessed to have a higher risk level than a business that is solely office-based. These ‘riskier’ industries may see a greater likelihood of accidents and therefore claims being made, leading to generally higher premiums for all organisations in that sector.
There are circumstances determining risk across your industry that you can’t influence. This makes the actions you take specific to your workplace all the more significant in the eyes of insurers. Ensuring you are fully compliant with health and safety regulations, as well as taking proactive steps to protect your employees and their environment, will help positively impact your risk level.
That said, while you might have these processes in place, insurance companies need to be able to see how they are managed. So how can you effectively and accurately demonstrate your safety practices to your insurers? This is where health and safety software can help.
How can health and safety software reduce your insurance premiums?
We know that health and safety software is a great way to support and promote your safety procedures internally, ultimately reducing risk in the day-to-day running of your business. But did you know that health and safety software is also a great way to showcase how your safety culture operates to external parties like insurance companies? Here are 5 ways in which health and safety software can help highlight your positive safety practices – giving insurers an accurate picture of your company’s health and safety culture while also providing them with confidence that you are doing everything you can to minimise risk.
1. Mobile apps that engage employees
High employee engagement is a good indicator of a positive and proactive health and safety culture. Making it easy for your teams to report and monitor incidents in the workplace is central to this. Using a mobile app is a great way for employees to quickly and simply report safety events such as hazards, near misses, accidents or injuries. With Notify’s incident management software and mobile app, you and your safety teams can also get real-time notifications of incidents reports, whenever they occur, speeding up the implementation of corrective actions and investigations.
With an easy-to-use app, companies will see increased levels of reporting, giving them more data to then proactively reduce the likelihood of accidents and injuries. This data can then be easily shared with insurers to show patterns of behaviour and how they have been dealt with / improved upon to reduce injuries in the future.
2. A digital audit trail
With health and safety software, you will have a digital audit right at your fingertips. You can demonstrate that risk assessments were created and issued, providing an overview of all the risks identified in one place. With a digital audit, you can show the process of how your risk assessments come together and what safety checks were carried out before any activities have taken place. A digital audit is also a great way to easily demonstrate your risk mitigation strategies and ongoing compliance with HSE regulations.
3. A centralised document repository
Insurers want to know that your health and safety documentation is accurate and up to date. Using digital software eradicates the need for multiple paper files in several locations. Instead, you can see all the documents you need in a centralised repository. You can quickly and easily access documents and, by having everyone in one place, you can ensure that everyone is using the correct version of the documents they need. This again enhances employee engagement and demonstrates to your insurers that you are prioritising accessibility and accuracy when it comes to your health and safety processes.
4. Training records
As we’ve mentioned before, insurers want to see a consistent and ongoing commitment to good safety practices. A great way to demonstrate this is to share your employee training records, which can be done electronically with digital software. Health and safety is an organisation-wide responsibility, so insurers want to know that employees are properly trained and can carry out their jobs safely and competently. With digital software, you can also demonstrate a good track record of employee training. You can easily highlight where training was taken in direct response to incidents and show that you are taking proactive steps to minimise risk in all areas of your business.
5. Central dashboard
With a central digital dashboard, you can view all of your health and safety data at any time. The dashboard acts like a digital health and safety hub, bringing all of your important safety data together in one place. With the central dashboard, you can highlight key trends and show how your safety initiatives are reducing key indicators including lost time incidents and the frequency of accidents in your workplace. The information from this dashboard can be easily shared both internally (for example to your board and employees) and externally (to regulators and insurance companies).
Being able to accurately reflect the shape of your health and safety culture will help insurers to better understand your level of risk and keep your insurance premiums down. Health and safety software can streamline this process for you, making it easier for both insurers and your teams to understand and influence health and safety in your workplace. With Notify’s digital tools, you can make your workplace a safer, healthier and happier place for everyone. If you’d like to find out more about how Notify’s digital solutions could help keep your insurance premiums down, get in touch and book your free, no-obligation software demonstration today.
