ABI initiative to assess trade association data for small businesses
The ABI has launched an initiative aimed at making it easier for small businesses with good health and safety standards to obtain employers' liability (EL) cover.
The initiative, Making the Market Work, assesses health and safety schemes operated by trade associations.
Under the initiative, trade associations or other similar bodies can submit details of their health and safety schemes to the ABI for assessment against best practice features that insurers expect to see in place. The ABI will then report back with an assessment of the scheme and suggested improvements.
The ABI will send details of the assessment to all members writing EL insurance. Insurers will take this information into account when assessing the risk from firms who belong to the association's health and safety scheme.
ABI head of general insurance John Parker said: "Everyone will benefit from a better flow of information. Businesses will understand the health and safety practices insurers are looking for, while insurers will be able to show that good health and safety practice in business is properly recognised."
The British Printing Industries Federation (BPIF) is the first trade association to submit its health and safety scheme for assessment.
BPIF national health, safety and environmental adviser Dale Wallis said: "We eagerly await the opportunity to translate good practice in health and safety into real savings for our members."
EL insurers have welcomed the introduction of the scheme saying it would assist them in quantifying the small risks that were usually difficult to assess.
Iron Trades employers' liability manager Giles Quartly said: "In the past, we have struggled to identify good features of small risks where perhaps there was a limited claims history. There have also been different levels of application of health and safety standards".
The initiative focuses mainly on small risks. While the scheme is aimed at only 30% of the market in terms of premium income, this equates to 70% of the market in terms of the number of businesses.
Quartly said the initiative "will attract lower EL premiums in the longer term", though insurers would not be pegging premium discounts to implementation of the best practice criteria.
"That's not viable due to the sheer diversity of trades," said Parker.
Quartly warned it could be "one to two years" before members of participating trade associations start to see decreases in their EL premiums.