Honan’s Risksmart has been working with clients on risk management solutions for more than 10 years. During this time, we have built a public liability database with over 15,000 incidents and almost 4,000 claims; providing us with the framework to help our clients make informed decisions. Not only that, but over these 10 years, we have seen more than our fair share of incidents that would have delivered a devastating financial blow to any uninsured business.
Unsurprisingly, there are dozens of factors that influence how much a claim may end up costing. While specific factors such as the claimant’s age, current health, or even employment status are certainly important, the central factors we can use to help determine cost are based on the injury itself.
When it comes to injury claims, there are 3 top considerations for employees and businesses:
1. THE NUMBER OF INJURED PARTS
It might seem trivial to state that there is a positive association between the number of injured parts and the overall average cost of the claim. However, this relationship is not as simple as it initially appears. As the graph above shows, on average, claimants who describe injuries in only one part of their body tend to walk out with more money than claimants injured in two different parts. Additionally, claimants who described damaging five different body parts did not receive a higher settlement than the ones who only injured four.
This shows that there is much more to establishing how much a claim can cost than just how many body parts a claimant states they hurt.
2. IS THE INJURED AREA A BODY JOINT?
Perhaps one factor that is initially overlooked in injury description is if the injured part is part of the major joint groups of the body. Joints are points in which two bones connect, inviting a higher risk of injury due to the greater range of movement they provide. We noticed that injuries that involve joints incur costs 88.42% higher than injuries to soft tissues or non-joint areas of the body.
3. THE SPECIFIC INJURED AREA
Finally, the actual injury area also directly influences the claim cost. The table below presents the available claim information we gathered for the Top 10 costliest specific injuries. Joint-related injuries accounted for 80% of the list – with only Head and Arm injuries as outliers. Shoulder-related injuries are by far the costliest on average; hitting an average cost of $11,412.29 (which is almost double the average costs associated with head injury claims).
Another noteworthy aspect of the injuries is the percentage of claims that incur costs higher than $100,000. One fifth of all Head-related and Upper Back-related claims reach or exceed $100,000. For Lower-back related injuries, about 21.21% of claims cost at least $100,000.
HOW CAN YOU REDUCE YOUR RISKS?
You can reduce risks for your clients by adopting a risk-aware culture that has your Duty of Care at its centre. Here are some key ideas to help you get started:
WITH YOU ALL THE WAY
The costs associated with injury claims can be tremendous, with potential risks to your bottom line. Choosing the right partner to help you navigate these risks is paramount. To find out more, please reach out at any time.
Claims Data Analyst