Explaining why insurance companies have a vested interest in ensuring the process works!
Fatigue is a common symptom with a reported prevalence in
the population ranging from 7% to approximately 45%. Fatigue is a
diagnostically nonspecific and associated with many health conditions. Broadly
defined, the symptoms are described as a feeling of weariness, tiredness or
lack of energy. Some Individuals experience a desire to sleep and may
experience a sudden onset of drowsiness or sleep.
Fatigue has been said to raise the risk factor for an
accident by a factor of 50. In a study conducted by the Virginia Tech
Transportation Institute, which was partly funded by the National Highway
Traffic Safety Administration, it is suggested that driving fatigued is responsible
for up to 20% of all reported auto crashes. This figure is up from the
suspected 7% formally recognized as the number.
Fatigue doesn't just raise an individual’s chance of having
an accident, it has been linked to health issues and it has a bottom-line
effect on the cost of conducting business. In a study, conducted by Judith
Ricci, ET. Al. (JOEM, Vol. 49, Number 1, January 2007), it is suggested that
fatigue costs employers $136.4 billion annually in health-related LPT, an
excess of $101.0 billion compared to workers without fatigue.
Fatigue is a universal issue that knows no boundaries in
business and occupation. In the world of
aviation, fatigue has been on the National Transportation Safety Board’s most
wanted list since the 1990s. Since being placed on the list, new programs have
been put in place such as the Fatigue Risk Management Systems approach to managing
fatigue. But what does it mean to manage risk? Especially fatigue risk? We’ll start with a brief description of what
risk management is…
Risk management is the process by which a company
systematically identify, measure and manage the various types of risk inherent
within their operations. The fundamental objectives of a sound risk management
system are to manage the organization’s exposure to potential loss and to
maximize operational productivity while avoiding accidents, incidents, and
loss. So, why should an insurance
company insist that a company have a fatigue risk management system in place?
Insurance companies make money by managing various types of
risk for individuals, municipalities and corporate entities – the risk of dying
too young, experiencing a loss due to an accident or natural disaster, and so
on. Where there is risk there is uncertainty, and where there is uncertainty,
there is exposure to loss. Using traditional risk management approaches, no
company can truly eliminate all exposure to risk. The primary benefit of the risk
management approach lies in the fact that the company does have the opportunity
to identify and quantify their risk, set tolerances, set standards and manage
identified risk based on those standards and expectations.
Since insurance companies insure against loss they must have
a vested interest in the risk management system of any company that they
insure. Based on the prevalence of fatigue in the workplace and the associated
potential for loss, they should pay particular attention to the Fatigue Risk
Management System. They should require
systems to be in place and be provided proof the system is being used and
supported.
In return for compliance with the insured companies, the
insurer should offer incentives to aid the company in further developing more
active and real-time intervention systems. The incentives do not have to be
huge. They can come in the form of modest discounts, safety magazines, aid with
fatigue risk management system audits, and accident forgiveness where
applicable systems strategies were in evidently in place. These
incentives should be a reward with a focus on fostering an environment of
fatigue safety and engagement at all levels of the insured company.
Note: Bob Novotney works as a Consultant with
KOSTechnology, Inc. a producer of real-time fatigue monitoring systems. To learn more about KOSTechnology, please
visit their website at: http://www.kostechnologyfms.com
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