Kevin Pallett is managing director of broker only commercial insurer Fusion. Having spent over 25 years in the industry, including time spent with NU and Independent, he is always prepared to speak his mind in order to modernise and improve the industry's working practices. Kevin writes about Health & Safety practices for SMEs.
Businesses face numerous and ever increasing threats to their survival. Work related injuries faced by employers, for example, have risen by 9% over the past year with over 25 million working days being lost each year.
The cost of those accidents to employers is spiraling ever upwards and is estimated to be in the region of £1.1bn. And this is only the tip of the iceberg.
For as long as I can remember, traditional insurance cover has played a key role in protecting businesses against such threats. But with increased litigation, escalating personal injury claims costs, profiteering lawyers, new threats and the resulting increased premiums to contend with, more and more businesses are now beginning to appreciate the benefits of improved health and safety initiatives.
However, this change in attitude has been a long time coming. We still have an enormous amount of work to do in persuading insurers, brokers and policyholders that this is the way forward.
In 2001 we decided to put our money where our mouth is by offering our policyholders and brokers a range of free risk management tools as an integral part of our insurance service. We offer technical briefings, health and safety planning tools, risk control assessment forms, a dedicated business continuity website and on-line health and safety training.
Some of our peers don't agree with providing these up front accident prevention and loss reduction facilities as part of the offer. But I would like to ask you a simple question – is it better to put your effort into dealing with a claim after the fact or preventing a claim occurring in the first place?
Fortunately, forward thinking brokers have bought into offering policyholders more than simply insurance protection. They have responded to what their clients' real needs are, which is not to spend more on insurance.
Many brokers have found that the additional services offered have helped them to win more business. But some policyholders, inevitably, have been slow to appreciate the benefits of taking a broader view of the risks that face their business. It is therefore the responsibility of the industry as a whole to continuously drive home the message that prevention of accidents must be a priority for UK businesses.
In my mind, if we are to treat our customers fairly and put their interests first we need to be offering them more than just insurance to protect their businesses. Rather than selling a standard package of insurance cover as cheaply as possible, insurers and their brokers should be assessing the risks faced and then finding practical ways to prevent and manage these.
And it doesn't take much effort to actually reduce some of the more common threats faced by businesses.
Traditional insurance cover will always have a role to play in protecting businesses against various threats. But now, more than ever, there is an overwhelming need for insurers and their brokers to prioritise prevention and proactive health and safety over after the fact claims management.