JERSEY CITY, N.J., November 8, 2001 — Insurers remain committed to loss-control services and enhanced performance levels, despite significant staff cutbacks in recent years, according to two surveys by Insurance Services Office, Inc.'s (ISO) Engineering and Safety Service (E&S) unit.
The surveys developed benchmarks on loss-control staffing levels and loss-control performance standards, including measures of quantity, quality, timeliness, policyholder services, and effectiveness of loss-control strategies.
Overall, professional loss-control staffing dropped 11 percent over the past five years, with large insurers reducing staff by 14 percent, according to the ISO surveys.
The decline in staffing is largely attributable to insurers' outsourcing much of their underwriting inspections, but outsourcing has also allowed insurers to provide policyholders more value-added service.
"Many insurers have re-deployed their loss-control professionals as consultants, who can now devote their expertise to helping policyholders reduce losses," said Richard P. Boehning, ISO senior vice president. "Insurers are also relying on technology to make their loss-control consultants more efficient and productive," Boehning added.
Loss-control consultants identify clients' exposures to losses and develop cost-effective solutions to manage exposures, so companies can improve safety, reduce accidents and injuries at the workplace, and strengthen their bottom line.
Portable computers loaded with software and reference materials have allowed loss-control consultants to operate in a digital environment, using everything from digital pictures of risks underwritten to e-mail correspondence with policyholders. Some companies are using voice-recognition software for further efficiencies, the surveys found.
The surveys found high educational attainment among loss-control professionals. The surveys revealed 86 percent of loss-control consultants have bachelor's degrees and 15 percent have advanced degrees. In addition, many loss-control staff members have achieved important professional designations. Thirty percent are Certified Safety Professional (CSP) designees, one of the most-recognized professional achievements in the health and safety field.
The surveys further revealed more than one-third (36 percent) of loss-control consultants are dedicated to technical specialties with advanced training in highly specialized areas, such as occupational safety and hygiene, business security, and product safety, to handle complex accounts and train others.
The surveys reported nearly 50 percent of loss-control consultants have more than 15 years of experience. Job satisfaction appears to be high among loss-control professionals whose turnover is lower than other departments at insurance companies. Moreover, companies expect less than 10 percent of their loss-control staff to retire in the next five years.
Nearly all companies surveyed reported that they have developed specific standards for measuring the performance of their loss-control departments. Companies have also raised their standards to evaluate the quality of customer service and meet policyholder expectations.
"Insurers are constantly challenging their loss-control departments to prove they provide value and cost-effective service to policyholders," said William F. Hauswirth, senior vice president of Engineering and Safety Service. "Half the respondents in the surveys said the reduction in losses for specific accounts was the most-frequently used measure of success. More than 36 percent identified reducing the loss ratio across the company's entire book of business as the measure of success," Hauswirth added.
ISO's E&S unit is a leading provider of information and services in loss control, risk management, safety and risk reduction in industrial, commercial and residential environments. E&S offers loss-control professionals a range of services, including technical reports, consulting, legislative and regulatory information, publications and training, and educational forums and conferences.
ISO is a leading source of information, and products and services related to property and liability risk. For a broad spectrum of commercial and personal lines of insurance, ISO provides statistical, actuarial, underwriting and claims information and analyses; consulting and technical services; policy language; information about specific locations; fraud-identification tools; and data processing. In the United States and around the world, ISO serves insurers, reinsurers, agents, brokers, self-insureds, risk managers, and insurance regulators and other government agencies.