At a glance
- Zurich experts Jim Wilkes and Huw Andrews discuss how manufacturers should best tackle health and safety from an insurer’s perspective
- Despite marked improvements, the UK manufacturing industry still accounts for a significant number of major injuries and lost-time accidents
- Zurich vast knowledge and expertise on health and safety can help manufacturers with their management approach
Produced in association with The Manufacturer magazine.
Although the health and safety record of the UK manufacturing industry has improved markedly over recent decades, there is still no room for complacency.
The manufacturing sector is thought to make up around 10% of the British workforce but still accounts for 25% of fatalities to employees and 16% of reported injuries to employees, according to the Health and Safety Executive.
To put that into context, on average around 50 manufacturing workers are involved in RIDDOR-reported accidents every day across the UK that are serious enough to keep the worker away from work for three days or more.
Insider sat down with Zurich’s Jim Wilkes, Senior Technical Underwriter, and Huw Andrews, Head of Casualty Practice, to discuss how to best tackle health and safety, the government reforms and using Zurich’s vast knowledge and expertise to help manufacturers contain their insurance spend.
Q. Why is staying on top of health and safety such an important issue for manufacturers?
Huw Andrews: Accidents, ill health and enforcement activity can result in unplanned costs, particularly as a result of increased fines for breaches of legislation, Fee for Intervention activity or from associated business interruption.
Jim Wilkes: It is an issue that needs constant attention. Health and safety is not something that gets solved by putting a solution in and walking away thinking that the job is done. You need to monitor and refresh it, otherwise basic errors may creep in. That’s why establishing effective, robust and transparent processes to manage health and safety risks remains a challenge for some manufacturers.
Q. How should health and safety be effectively managed?
Jim Wilkes: You need to approach this systematically. It may seem boring, but in the long run you will have fewer failures. You should treat health and safety the same as you would other similar risk management issues. And if you have a formalised system in place, you can help defend yourself in the event of an accident.
Q. How can Zurich help?
Huw Andrews: At Zurich, we deal with some 40,000 personal injury claims every year. Looking at the types of losses in detail, it is clear that there are certain types that occur regularly in manufacturing premises.
Typical losses include those resulting from slips and trips, falls from height, manual handling, workplace transport and being injured by tools or equipment as well as noise-induced hearing loss.
We see a wide variety of risks and many different approaches adopted to manage them. Managing the hazards associated with these losses include using risk assessments to identify appropriate precautions, implementing and maintaining the precautions identified as being necessary and providing adequate information, supervision and training for employees relating to these precautions and any associated responsibilities.
Jim Wilkes: Yes, our knowledge is pretty useful. Although employers’ liability insurance is required by law and many insurance companies provide it, what we would rather do is have a relationship with our customers. Yes, we provide the insurance but we are also offering our knowledge and expertise as part of the proposition. And that can be a powerful addition to improving risk management performance.
Q. How can manufacturers balance the challenge of health and safety with productivity requirements?
Huw Andrews: Improving health and safety standards can actually improve productivity from both an operational and cultural perspective. Despite an initial outlay, this could save money and add to your profitability.
Jim Wilkes: Even basic measures such as adopting a robust health and safety policy may also win you future contracts. A lot of local authorities and some companies are now demanding that you operate high standards around health and safety. If you don’t meet these, then you just won’t get through the tendering system.
Q. How can manufacturers potentially contain their insurance spend?
Huw Andrews: From an employers’ liability perspective, it is obvious that those manufacturers that are capable of minimising the potential for accidents and ill health make for a better proposition.
One of the indicators is that the organisation has adopted a number of key principles in their approach to managing health and safety, such as a commitment to senior management, adopting a structured approach and ensuring the adequacy of risk assessment to define performance standards.
Implementing these effectively in a sensible and proportionate manner will help to prevent accidents, drive appropriate performance and – where things do go wrong – provide a basis for the defence of claims.
Jim Wilkes: The insurance market like other sectors has periods when it becomes more difficult to place risks, or terms become more expensive. This is when any manufacturer that has incorporated effective health and safety management into their business activities and can evidence this can improve their negotiating position.
Any manufacturer that has incorporated effective health and safety management into their business activities and can evidence this can improve their negotiating position with insurers
Jim Wilkes, Senior Technical Underwriter
Q. How have the UK government reforms altered the health and safety landscape?
Jim Wilkes: The last four years have seen considerable activity relating to health and safety and to address the issues of a compensation culture, including Lord Justice Jackson’s review of civil litigation costs.
Huw Andrews: There have been a number of impacts. Take, for example, the recent Ministry of Justice changes. These will have both a financial and operational impact for manufacturers. Claims are now notified through an electronic portal and there are reduced timescales on decision-making.
When specified timescales are not met, the claim is removed from the ‘portal’ process. This could incur significant cost and it is important for manufacturers to work closely with their insurer. For example, it is critical that all relevant documentation to support the defence of a claim is provided to them quickly.
As a result, manufacturers need to review their procedures to ensure that they remain adequate in the context of these changes.
To read Zurich’s Workplace Health and Safety Report 2013, click here.