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Workers Compensation

It’s safe to work in (not on) marijuana

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There’s a pervasive myth out there that the marijuana industry is an unregulated Wild West populated by desperadoes and mountebanks out to score a quick buck.

But even a passing familiarity with how the industry operates in states with legal recreational and medical marijuana should be enough to dispel that myth. Marijuana operations are subject to extremely strict licensing requirements and regulatory oversight. Every player in the marijuana supply chain is tightly controlled – from cultivators to retail stores to, yes, the buyers themselves.

In fact, a recent analysis from workers compensation insurer Pinnacol Assurance suggests that the industry’s strict regulatory oversight may also be the reason why it’s a safe industry to work in.

Pinnacol’s analysis looked at Colorado claims data for marijuana workers. There were 350 injuries in 2018, most of which were strains, cuts, and slips and falls. Pinnacol concluded that the industry is relatively safe when compared to similar job-types in Colorado.

In addition to tight regulations, the analysis suggests that Colorado marijuana operators are also increasingly focused on safety and risk mitigation.

But working in marijuana is different from working on marijuana. Working stoned is probably a bad idea. You can read more about marijuana and employment issues here.

Auto Insurance, Homeowners Insurance

Florida legislature passes AOB reform

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Insurance Journal reports that the Florida Senate has passed a bill designed to reform parts of the state’s insurance assignment of benefits (AOB) system. Governor Ron DeSantis has stated that he plans to sign the bill into law.

Florida’s AOB system has long been in dire need of reform.

As we document in our report “Florida’s assignment of benefits crisis”, an assignment of benefits (AOB) is a contract that allows a third party – a contractor, a medical provider, an auto repair shop – to bill an insurance company directly for repairs or other services done for the policyholder.

The process is innocuous and common throughout the country. But as our report notes, Florida’s unique legal systems richly rewards plaintiff’s attorneys and vendors when they submit inflated bills to insurance companies and then file lawsuits when those bills are disputed.

Not just a few lawsuits. Lots of lawsuits. The numbers are staggering. There were roughly 1,300 AOB lawsuits statewide in 2000. There were more than 79,000 in 2013 and more than 153,000 in 2018, a 94 percent increase in just five years.

Inflated claims and massive volumes of lawsuits have the predictable result of driving up insurance companies’ legal costs. Insurers are forced to then pass those costs on to consumers. In the study, we estimate that Florida’s auto and homeowners policyholders have paid about $2.5 billion more for insurance over the past dozen years to cover the increase in legal costs.

That doesn’t even count the billions more in excess claim settlements that are at the heart of the problem.

The new bill seeks to address the problem by reforming how AOBs can be executed and how plaintiff’s attorneys can get paid for lawsuit settlements. If signed, the bill will come into effect on July 1, 2019.

You can download our report documenting the crisis here.

Insurance Industry

From the I.I.I. Daily: Our most popular content, April 12 to April 18

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Here are the 5 most clicked on articles from this week’s I.I.I. Daily newsletter.

To subscribe to the I.I.I. Daily email daily@iii.org.

 

 

 

Corporate Social Responsibility

Recruiting young workers through a culture of volunteerism

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photo courtesy of State Farm®

Did you know that volunteering your time and expertise can make you happier and healthier? It’s been shown that unpaid work for the good of others enables people to make new friends, learn new skills and experience reduced stress levels.

And it’s not just individuals who benefit. Companies that create a culture of volunteering have better employee morale, workplace atmosphere and brand perception. A Deloitte study found that a large majority (89 percent) of employees think that companies that sponsor volunteer activities offer a better work environment. Volunteer activities were also reported to be more effective at boosting staff morale than company-sponsored happy hours, and more than three-quarters of workers said that volunteering is essential to employee well-being.

The insurance industry is no slouch when it comes to volunteering. The Insurance Industry Charitable Foundation (IICF) has contributed more than 300,000 volunteer hours to hundreds of community nonprofit organizations since its inception in 1994. The industry gives back to communities in significant and varied ways including pro bono and skills-sharing support to nonprofit organizations, disaster response, relief and recovery, employee-driven outreach in local communities and many other creative corporate social responsibility initiatives.

The industry is also hoping to recruit and retain workers by emphasizing the culture of volunteering. On April 10, the IICF released a white paper documenting the findings of its Millennial Ideas Summit. The summit convened in late 2018 with more than 50 young leaders and emerging talent from across the insurance industry to discuss key topics and challenges facing the industry. These included talent and recruitment of millennials; technology, innovation and change; and social responsibility, particularly the industry’s philanthropic response following natural disasters.

The paper, What Millennials Want, how are we engaging the millennial workforce, concluded that communicating to the younger workforce that insurance is a business of service and one that helps people in their times of need is critically important to millennials, who want opportunities to give back and make a difference through experiences and grassroots ways that help their communities.

April is National Volunteer Month. What is your company doing to promote volunteerism? Let us know in the comments section.

 

Workers Compensation

WCRI releases 2019 workers compensation law compendium

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This week, the Workers Compensation Research Institute (WCRI) published its latest edition of workers compensation laws in the U.S. and Canada, which includes regulations and benefit levels as of January 1, 2019.

Per WCRI:

In Canada and the United States, workers’ compensation is entirely under the control of sub-national legislative bodies and administrative agencies. The differences between jurisdictional laws and regulations can be subtle and this survey gives you the ability to understand those differences.

WCRI members can download the report here.

For the more casual readers out there, check out our page on workers compensation and how it works.

Careers and Employment, Insurers and the Economy

Making sense of the dip in property/casualty carrier employment

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By Dr. Steven Weisbart, Chief Economist, Insurance Information Institute

 

On a seasonally-adjusted basis, the number of people working for property/casualty (p/c) insurers has been dropping continually for two years (since February 2017), from 551,200 to 520,700 (the preliminary estimate for February 2019).

Seasonal adjustment plays a small part in determining these numbers. The not-seasonally-adjusted p/c carrier employment for February 2017 was 549,500, and the February 2019 preliminary estimate was 518,600.

What’s going on? Is this a trend? Based on the numbers alone, it’s hard to tell. Consider the following graph of seasonally-adjusted p/c carrier employment since January 2011 — 18 months after the official end of the Great Recession:

Source: Bureau of Labor Statistics

Don’t be misled by the spike in March 2015-March 2016. This is how the Bureau of Labor Statistics incorporates a change in classification—that is, in this case, some people who were previously not considered employed by p/c carriers were, as of March 2015, now considered as employed in this industry. Rather than an instant change, the adjustment is made over twelve months beginning and ending in March.

Since the data that begin in March 2016 also show a downtrend, it is easy to infer that, if there had been no reclassification in 2015-16, the downward trend that started (on the graph) in 2011 would in 2019 probably show p/c carrier employment at or below 500,000.

Although we don’t readily have policy counts over that span, it is reasonable to assume that, with growth in the population and the economy, p/c carriers are growing, and doing so with fewer employees. It is likely that at least some of this is due to the use of digital methods for activities that humans previously did. P/C carriers are becoming more productive.

Insurance Industry

From the I.I.I. Daily: Our most popular content, April 4 to April 11

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Here are the 5 most clicked on articles from this week’s I.I.I. Daily newsletter.

To subscribe to the I.I.I. Daily email daily@iii.org.

 

Health & Safety

Commercial insurance, diseases and epidemics

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In a previous article, we discussed how personal insurance policies address communicable diseases and epidemics. In this article, we’ll look at how commercial insurance policies handle these issues.

Between 1918 and 1919 the so-called Spanish influenza pandemic* killed at least 50 million people worldwide and infected about 500 million people – or about 1/3 of the entire world’s population at the time.

While the Spanish flu’s destructiveness has been an outlier over the last several decades, epidemics and pandemics on a smaller scale do still happen (avian flu, swine flu, Ebola, etc.).

How could disease outbreaks impact commercial property and general liability insurance?

[Content warning: wonky]

Continue reading Commercial insurance, diseases and epidemics →

Homeowners Insurance

Avoid a Double Tragedy: Tips from National Dog Bite Prevention Week® Coalition Partners

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Janet Ruiz

Our previous post discussed homeowners liability claims stemming from dog bites. Today, Janet Ruiz, I.I.I.’s Director of Strategic Communications, has these valuable safety tips from National Dog Bite Prevention
Week ® Coalition partners.

The American Veterinary Medical Association (AVMA) estimates there are approximately 78 million dogs in U.S. homes and each year 4.5 million people are bitten or injured. “Even the gentlest dog can bite if they are in pain, feel threatened, or are competing for resources such as food or space,” said Dr. John de Jong, AVMA President. “Not only is it important to understand how dogs behave, it is important to understand how a dog may interpret our behavior.” AVMA’s ‘Jimmy the Dog’ video series lets preschoolers look at how a dog might interpret different scenarios.

“We’ve seen firsthand over the years the tragic consequences surrounding dog bites and their effect on those involved – the people who are injured, the animals who may be relinquished or even destroyed, and the dog’s owners who have to cope with the loss of a beloved family member,” said Lesa Staubus, DVM, American Humane Rescue veterinarian, “Once your dog has bitten someone – or you or a family member fall victim to a dog bite – it will be already be too late.  Let’s practice good prevention instead.”

Because of the high-risk involving dogs, babies, and children, American Humane offers a free online booklet called Pet Meets Baby that provides families with valuable information on introducing a new child to a home with a dog.

Additional safety tips from American Humane include:

  • NEVER leave a baby or small child alone with a dog, even if it is a family pet. Children are often bitten by dogs in their own household.
  • Make sure your pet is socialized so it feels at ease around people and other animals.
  • Walk and exercise your dog on a leash to keep it healthy and provide mental stimulation.
  • Regular veterinary visits are essential to regulating the health of your dog. A sick or injured dog is more likely to bite.
  • Be alert. If someone approaches you and your dog, caution them to wait before petting the dog. Give your pet time to be comfortable with the stranger.
  • Understand and respond to changes in your dogs’ body language. Look at the eyes, ears, tail, and posture to know when your dog may be happy, fearful, or angry.
Cyber Risk

Hope the (fire)wall is high enough

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Fans of Game of Thrones are getting ready to learn the fate of their favorite characters when the final season of the show starts airing on HBO on April 14th. At the same time, security experts are warning that cyber-crooks are ready to take advantage of the show’s popularity to attack people’s computers.

The huge popularity of the show makes illegal download sites, where users can view episodes without the required subscriptions, popular distribution points for malware. In 2018 Game of Thrones accounted for 17 percent of all infected pirated content, according to Kaspersky Labs, even though no new episodes aired that year. This suggests that the coming premiere could be the most dangerous time to be downloading the torrents.

According to Kaspersky, the most popular kind of attack via pirated content was a trojan, a piece of software that is installed on a computer and allows the hacker to take control of that device.

The good news is that, overall, the prevalence of TV show-related malware has been declining. In 2018, the total number of users who encountered this kind of malware was 126,340, a third less than it was the year before. The number of total attempts dropped by 22 percent, to 451,636. Kaspersky said that drop was in line with a reduction in the number of security threats across the internet. But it might also be linked to a drop in the number of people using torrents, as interest in the technology declines.

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