Any business operating with employees needs to implement a formal safety program. The purpose of your safety program is to help everyone understand their roles toward the common health and safety goals of the company.

Below are some basics to help you get started.

Employers have responsibilities related to hazard control and worker health and safety. In carrying out these duties, management can express their commitment to employee health and safety in the workplace.

General employer responsibilities include

• Ensure the health and safety of the employer’s workers and other workers (subcontractors, temporary employees etc) at the workplace.
• Establish occupational health and safety policies and an OHS program specific to your business type.
• Provide general direction to management, supervisors, and workers about their responsibilities and roles in providing a safe and healthy workplace.
• Provide specific direction and delegate authority to those responsible for health and safety.
• Consult and cooperate with individuals carrying out occupational health and safety duties (including joint committee members, worker health and safety representatives, and prevention officers). In small operations an owner and/or officer will obviously take on these responsibilities.
• Provide workers with the information, instruction, training, and supervision necessary to protect their health and safety.
• If applicable, provide supervisors with the support and training necessary to carry out their health and safety responsibilities. As with any task, people need to be properly trained if they are to be expected to perform properly. Safety is too important to not provide adequate training. On-going training opportunities should be made available on a regular basis and employees should be required to participate.
• Provide and maintain protective equipment, devices, and clothing, and ensure that they are used properly.
• Make a copy of the Workers Compensation Act and the Occupational Health and Safety Regulation readily available for review by workers.

An effective program will:

• Identify hazards in the workplace
• Eliminate or minimize the potential for injuries, disease, or loss of life
• Limit financial claims resulting from injuries and disease
• Provide a written safety policy including posting appropriate safety signs and rules, procedures for accident reporting and analysis, and procedures/penalties for violation of safety rules.

One of the most effective things that an Owner, Officer or Manager can do, is to create an attitude that “safety is important”. Leadership by example will go a long way toward gaining employee support and belief in maintaining a safe and healthy work environment.

For Starters, What is an Occurrence Policy?

With an Occurrence Policy, the coverage “Trigger” is the date the damage occurs. It provides liability coverage only for injury or damage that takes place or “occurs” during the policy period, regardless of when the claim is actually made. For example, a claim made in the current policy year could be charged against a prior policy period, or may not be covered, if it arises from an occurrence prior to the effective date. It doesn’t matter when damage first manifested. What matters is when the occurrence took place. The occurrence policy insuring agreement states that they will pay for COVERED occurrences that take place during the policy period. PERIOD. If an insurance agent ever tells you that you are covered in the future with your occurrence policy, ask for this in writing along with a copy of the agent’s own professional liability insurance policy because this may be the only policy that will provide you with future coverage.

Claims-Made Coverage

You guessed it! The coverage trigger is when the claim is made, and the claim must be MADE during policy period. The policy provides liability coverage only if a written claim is made during the policy period or any applicable extended reporting period (also known as a tail). Also, a claim made in the current year could be charged against the current policy even if the injury or loss occurred many years in the past except when the policy has a retroactive date, this restricts coverage only to occurrences after that date. Most policies have a retroactive date.

Manifestation Provision

The manifestation clause restricts the Occurrence coverage by stating that the damage must manifest during the policy period to be considered an occurrence. The DAMAGE is the coverage “Trigger” rather than the completion of an operation. The bodily injury or property damage must first manifest during the policy period. The insurance does not apply to any bodily injury or property damage that is continuous or progressively deteriorating and that first manifested prior to the effective date of the policy or after the expiration of the policy, even if such injury or damage continued or deteriorated during the time of the policy, and whether or not such occurrence is known to any insured. If the date of the first bodily injury or property damage cannot be determined, then usually the date of first damage or injury shall be deemed to be the earliest date on which the process, which led to the bodily injury or property damage began.Regardless of the policy’s exact definition, the damage can only FIRST manifest once and so only the policy in which it first manifests will have an obligation to pay.

What is the Sunset Provision?

The Sunset Provision sets a limit on the amount of time that a claimant has to submit or report a claim on a policy. The policy will not provide any coverage, regardless of the other terms and conditions of the Policy, including the definition of “occurrence” for any claim or “suit” or demand for damages made against an insured unless the claim or “suit” or demand for damages is reported in writing within the specified number of years after the Policy Period or the state statute of limitation applicable to work performed, if that statute is less than the specified number of years in the sunset.

Why Do Brokers Offer Policies With the Above Restrictions?

We know that in today’s economy, insurance consumers must be very cost-conscious. As a way to reduce the cost of insurance, carriers have developed these Sunset and Manifestation Provisions to reduce their risk exposure. This in turn, provides our clients with the ability to choose basic general liability coverage at a significantly REDUCED COST!

For instance, CIGA’s limit for paying out on liability claims is $500,000. So if a claim for $1,000,000 is filed against you, and your insurance carrier went broke, even if CIGA steps in, you could still be on the hook for the other $500,000. Almost all A rated carriers though, (including non-admitted carriers), are reinsured by another larger carrier. (Your carrier purchases insurance with another carrier to cover your claims in the event they can’t). So in this case, if your carrier goes belly-up regardless of their admitted or non-admitted status, the reinsurance carrier may step in before CIGA does.

By contrast, Non-Admitted companies have elected not to be authorized by the state DOI. Often mistakenly perceived as being “shaky” or questionable companies, these carriers intentionally opt not to be admitted in order to allow more leeway in pricing and coverage scope for policies they will write. Admitted companies may be unable to insure risks due to limitations on premium increases imposed by the DOI, where Non-Admitted companies can be very flexible and can act fast in order to keep up with market changes. This flexibility will often result in a customized coverage solution for complex policy placements or for those who operate businesses seen as higher risk by admitted carriers.

Just because a carrier is admitted, doesn’t mean they are more financially solvent. Sometimes just the opposite can happen, that because of the restrictions on rates and coverage forms, admitted carriers’ claim payouts could increase faster than allowed premium increases in certain classes of business. This could cause a carrier to find itself in financial trouble if they don’t have the freedom to increase premiums in order to keep pace with claims. My agency is careful to write business with carriers in good financial standing , and when in doubt, (because ratings can change quickly), we can look up their financial strength rating with independent rating bureaus like AM Best and supply this to you.

Admitted vs. Non-Admitted

So, now you understand, the question shouldn’t necessarily be “Admitted vs Non-Admitted?”, but “is this company financially capable of paying my claim in the event of an accident?”

It is important to work with an Agent/Broker you can trust, and always take the time to understand the full implications of the offered terms and conditions and know the status and standing of any insurer being considered for coverage.