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Insurance tip for your business

Medical and indemnity costs have been increasing at alarming rates in recent years. These costs have not only impacted the insurance industry, but have also resulted in higher insurance premiums for you, the customer. In an effort to address this trend, CNA Insurance has conducted a complete review of all the “cost drivers” that contribute to these increased costs. Although this review identified several key issues, the one that was found to be the most critical in all lines of insurance is “Timely Notification of Loss.”

What is “Timely Notification of Loss?” Timely Notification of Loss simply means that whenever an injury occurs or has been reported to someone in a supervisory or management role in your organization, this loss must immediately be reported to your insurance carrier. Most times, this can be done online or by telephone, 24 hours a day, seven days a week. Reporting of the injury should be completed within 48 hours of the injury to maximize the handling of the claim.

Timely notification helps your carrier and you
Timely Notification of Loss allows your carrier to promptly begin the process of communicating with the injured employee, physician, you, the employer, and developing a model to resolve the claim in an efficient, professional manner.

This allows carriers to provide quality service. Anyone who has experienced bodily injury or a work-related injury needs to be assured that his or her claim will be handled fairly and as quickly as possible. If the carrier is notified in a timely manner, they can act immediately in determining compensability and begin to manage the claim.

By promptly reporting of the claim it can have an impact on your bottom line profitability reducing the overall cost of the claim and being able to return the injured employee to gainful employment in a quicker manner.

Benefits to the employer
The employer benefits by:

1. Allowing the claims adjuster to complete a timely investigation interviewing key witnesses to determine an appropriate plan of action to resolve the claim.
2. Affecting employee satisfaction by communicating and letting the employee know we will be taking care of the bills and the employee will be receiving the proper compensation set by his or her state law.
3. Allowing detection of “red flag” indicators for possible fraud by the employee and the opportunity to pursue subrogation against a third party.
4. Having medical treatment completed at a Preferred Provider Organization (PPO) where the clinic is familiar with treating workers’ compensation injuries (where applicable by state law).
5. Improving customer satisfaction by not losing productivity and missing a delivery date.

Prompt reporting of an employee injury is one of the most effective tools in controlling your workers’ compensation costs and recognizing the opportunities of developing a system to report the claim affords your organization a direct line to profitability by reducing medical cost, enhancing recovery time, and returning a worker back to work more quickly. This should become part of how you do business on a daily basis. 

The information, examples and suggestions presented in this material have been developed from sources believed to be reliable, but they should not be construed as legal or other professional advice. CNA accepts no responsibility for the accuracy or completeness of this material and recommends the consultation with competent legal counsel and/or other professional advisors before applying this material in any particular factual situations. This material is for illustrative purposes and is not intended to constitute a contract. Please remember that only the relevant insurance policy can provide the actual terms, coverages, amounts, conditions and exclusions for an insured. All products and services may not be available in all states and may be subject to change without notice. CNA is a registered trademark of CNA Financial Corporation. Copyright © 2012 CNA. All rights reserved.