Accidents happen, and for a business, they can be quite costly.
To prevent future losses, accident investigation can be an important tool to help businesses determine why an accident happened, then take steps to prevent the same type of accident from happening again.
“If you’re having a series of similar accidents, eventually you’re going to have a severe one that million-dollar claim,” says Charles Russo, account executive with ECBM Insurance Brokers and Consultants. “As a company, you have to identify and analyze the types of loses your organization is prone to and put time-tested and effective prevention measures in place to increase driver awareness, preparedness and safety. A company can’t efficiently accomplish this without commitment, focus and open communication.”
Smart Business spoke with Russo about how to use accident investigation to prevent future accidents.
What type of accidents should be investigated?
First, let’s define accident. An accident is any unplanned event that results in personal injury or property damage. When the personal injury requires little or no treatment, it is considered minor. If it results in a fatality or severe bodily injury, the accident is serious.
Property damage also may be minor or serious. This distinction is important because following an accident, people are often in shock. The extent of injury is sometimes difficult to determine right after an accident, and minor incidents have the potential to become larger losses once the dust settles. Therefore, it is important to gather as many details as possible. All accidents should have some level of investigation at the scene, regardless of the extent of injury or damage initially reported.
How can accident investigation help reduce losses?
By using the information gathered through an investigation, a company’s safety department is in a better position to review the circumstances that led to the situation and prevent similar or more disastrous accidents from occurring. This is why investigations are so important to continually identify causes and work on preventing the next big accident.
When should an investigation be completed?
The level of the investigation depends on the severity of the accident, but some level of information gathering is required regardless. Most times, a minor fender-bender causing nominal property damage and no injuries does not require a full-blown accident investigation. An officer will be called and information will be exchanged between the involved parties. Property damages will be fixed by the party responsible, or their insurance carrier, and that will be the end of it. An accident with severe property damages and serious injuries or fatalities requires a more intensive investigation. In those situations, an accident reconstruction specialist should be called to the scene to determine what happened.
How can businesses make sure that accidents are properly investigated?
Calling law enforcement to the scene is a must. Most accidents that occur will likely be transferred over to a company’s insurance company through the insurance broker.
Make sure you have the right insurance professional. A large proportion of a transportation company’s risk is over the road. Make sure you have a professional who understands your business, knows how to negotiate the best coverage terms to protect company assets from accidental events, and who can act as an advocate on your company’s behalf when a loss occurs. This is key for a business that has a potentially high exposure to losses because of the level of risk inherent to the business. Transportation is a very specialized field and you need insurance professionals who know the exposures inherent to this industry and who are able to match up the right coverage to transfer high-cost losses.
Too many companies go with agents and insurance carriers that don’t understand their business, or the coverage needed to protect them. The best agencies specialize, are committed to understanding their clients’ individual business needs, have strong relationships with insurance carriers that understand the industries for which they write coverage and provide a dedicated claims department to assist in investigations when accidents occur.
How can businesses prepare employees to do the right thing if they are involved in an accident?
The first step is having a well-defined written safety manual that includes policies and procedures. The second is making sure that employees understand what needs to happen when an accident occurs. Written procedures should outline what is expected in the event of a loss, who the employee needs to contact, what information the employee needs to gather at the scene and how the employee should conduct himself or herself. Employees should never accept fault at the scene. Only an investigation conducted by law enforcement, accident reconstructionist and the parties’ insurance and legal professionals should determine cause. This will allow a liability determination to be made that recognizes the extent that each party was responsible.
The goal of an investigation is not to place blame. Open discussion between employer and employee prevents employee apprehension and allows accurate facts regarding the accident to be gathered. Without this information, prevention becomes cumbersome and difficult to manage. That, in turn, ultimately costs the company more money and time.
Training and preparedness are extremely important. When Captain Chesley Sullenberger landed his plane in the Hudson River, everyone survived. He attributed the outcome to training, saying his ‘entire life was in preparation to handle that particular moment.’ Drivers and transportation companies have a similar responsibility to focus on the safe operation of their vehicles, safety of other motorists and the safe delivery of freight.
Charles Russo is an account executive with ECBM Insurance Brokers and Consultants. Reach him at (610) 668-7100, ext. 1228, or firstname.lastname@example.org.