An employee is injured … A fire occurs … An invitee trips and falls …

Unfortunately many companies are not focused on loss control measures until -

It’s too late. It’s probably accurate to say, beyond the “human” considerations, insurance often foots a big piece of the bill. But often at a cost that, in the longer term, doesn’t serve the financials as well as an upfront investment in loss control would have.

Risk management is all about reducing and mitigating the exposure to risk which in turn reduces costs.

Basically there are three loss control approaches -

Avoidance, Prevention and Reduction.

Each of these can be employed in a pro-active or a re-active fashion. In addition there are a few other loss control tools that can be utilized to reduce risk – separation, duplication or redundancy, contractual transfer and salvage.

Becoming more proactive in your C-Level approach to loss control will serve to help reduce the overall cost of your organization’s insurance and risk management program. By taking a proactive approach to loss control you also place your company in a strong position when it is time to renew your coverage.

No matter what your business is it is important to keep yourself, employees and those working with your organization informed of safety issues.

We had a client come to us for help with a very large residential real estate portfolio.

Most of the buildings were located in New York and were garden style brick apartments and mainly low income housing. They had several very large losses that were prohibiting them from finding insurance coverage at a reasonable cost. One of their largest losses was a result of a Christmas tree fire.

The fire took three lives as well as disrupting the lives of dozens of residents and causing hundreds of thousands of dollars in property damage. In addition to that one, they had two other Christmas tree fire losses that took place in separate buildings over the years. (I would say that was a problem)

Who would have thought that such things could happen? Maybe these fires could have been prevented had the landlord informed the residents of the potential dangers related to Christmas tree fires by sending out a Christmas Tree Fire Safety Flyer? Would this have totally prevented that particular fire from happening?

Maybe, maybe not – but they would have had a much better chance of preventing it than how it ended up. Believe it or not, the large fire was a result of the tenant using “live” candles on the Christmas tree – The landlord finally sent out a notice to all residents that the use of real candles on Christmas trees was prohibited. Now the landlord has a tenant safety program that informs tenants on a variety of safety topics on a quarterly basis.

Bottom Line:

A major factor in reducing risk is awareness. Risk Management is all about awareness. Developing a risk management program geared toward awareness is essential. Organizations are busy conducting “their” business everyday. It is difficult for them to concentrate on what they might consider to be extraneous issues. But once these issues are addressed business owners are generally thankful that they were brought to their attention.

We all have a lot of different things on our minds everyday, however if we make an effort to draw attention to a particular issue – that is more than half the battle. What risks do you face that could affect your business and how do you address them in terms of informing those around you? In the long run, a focus on safety and safety awareness will save you money and save you from the heartache of dealing with a serious loss and all that comes with it.