New developments in insurance technology may lead to fewer accidents and decreased workers’ comp claims costs.
Emerging technologies have started to make inroads into the field of workers’ compensation insurance, digitizing everything from claim submittals and processing to medical treatment oversight. Even the process of buying workers’ compensation coverage has begun its inevitable shift to the internet. Just recently in Florida, the state’s Division of Workers’ Compensation launched the Coverage Assistance Program (CAP), an online database where companies can search for carriers that sell policies to insure employees who suffer workplace injuries.
“Ensuring that Florida businesses have proper workers’ compensation coverage is crucial to the success of the entire workers’ compensation system,” said Director of the Division of Workers’ Compensation Tanner Holloman. “Employers can use the information provided in the CAP to inform conversations with their insurance agents and to help facilitate a smoother, faster policy purchasing process.”
Buying policies online is the first step to a new workers’ comp system, but not the only one. Increasingly, companies across industries are using technology to prevent injuries, move claims through the system more efficiently, and oversee care as each employee recovers.
Prevention is Key
Lowering the costs associated with workers’ compensation depends, of course, on preventing injuries. In that area, technology plays a key role.
Smartphones, mobile devices, and company intranets can all funnel training modules that educate employees about how to avoid on-the-job injuries, Marsh’s Market Research Leader Tom Ryan noted during a recent broadcast reported in Insurance Journal. In addition, wearable devices can track employees’ movements, alerting them to any hazards or potentially harmful repetitive motions that they may be performing. These devices also log the worker’s body temperature and send notifications if the worker is fatigued, because tired and sick workers are often prone to accidents.
After the Accident
If an accident does occur, companies have found that streamlining the claims process helps workers get the treatment they need (and get back to work sooner). VP of Workplace Safety at Northwell Health Joseph Malloy told Insurance Journal that Northwell has centralized and automated its workforce safety department as well as its employee injury reporting system.
In the past, accident reports were dispersed to different departments, which often yielded inconsistent information. Now, employees can fill out automated forms that are partially pre-filled with their data. Reports can be filed either through a mobile app or an 800 number, and once completed, the report is send to all relevant personnel. Because of the new system, more workers have gone through transitional work assignments after an incident, and employees have had a largely positive response on the whole, Molloy said.
Meanwhile, Bank of America has taken advantage of a similar trend in telemedicine. Senior Insurance Manager Donna Sides told Insurance Journal that the organization is making use of a telenursing platform wherein injured workers call a registered nurse to report an incident. The report is then uploaded into the bank’s claims database, where it can be viewed by adjusters.
After assessing the employee’s condition, the nurse can make a treatment recommendation. If necessary, the nurse can also schedule an appointment with an in-network provider. According to Sides, the new system has significantly lowered claims costs.
A New Era for Workers’ Compensation
If innovations like telemedicine can bring down workers’ comp expenses, the insurance industry can and should welcome the insurtech revolution.
Overhauling workers’ compensation as soon as possible is especially vital because insurers in this field must also confront the challenges of covering independent contractors employed in the “gig economy” (as typified by Uber drivers). Several companies that serve as the conduit between independent contractors and their assignments have started to establish funds to provide different insurance benefits, including workers’ compensation. Some cities and states have even introduced legislation to ensure that these workers receive benefits.
The ever-present prospect of upcoming rate hikes is also plaguing the worker’s compensation industry. Last year, Florida’s Office of Insurance Regulation raised rates by 14.5%, which immediately drew strong criticism from the state’s small business owners. But as Bank of America and Northwell Health have demonstrated, savvy insurers can leverage technology to reduce overall costs and modernize the workers’ compensation process.