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A Proactive Insurance Product for Providing a Safe Workplace

A Proactive Insurance Product for Providing a Safe Workplace

Workplace violence is an uncomfortable and frightening risk. In an interconnected world of social media and 24-hour news coverage, we have all undoubtedly noticed a handful of these events. For every incident, such as those in Orlando and San Bernardino, there are even more occurrences of workplace violence that go uncovered by the national news front.

According to the United States Occupational Safety and Health Administration (OSHA), nearly 2 million American workers report having been victims of workplace violence. Workplace violence, as defined by OSHA, is “any act or threat of physical violence, harassment, intimidation that occurs at the worksite.” The results can be devastating not only for individuals, but also for employers.

The National Institute for Occupational Safety and Health estimates the annual cost of workplace violence for employers to be close to $121 billion. In addition to the potential for loss of life and property, businesses are impacted by expenses for security, public relations, employee counseling and rehabilitation, loss of income, additional salaries, and legal liability.

There is a common misconception that an employer’s general liability policy or terrorism endorsement would afford coverage to a workplace violence incident. Unfortunately, that is not correct. For an act to meet the definition of terrorism, at least in the insurance world, it must be deemed a certified act by the Secretary of the Treasury. More importantly, a general liability policy does not specifically include coverage for active shooters or threats of violence. There is not enough case law to dictate whether the liability policy would provide any protection to an insured, and even if it did, the benefit would be completely reactionary. Fortunately, there is insurance coverage available which not only provides dedicated coverage for workplace violence, but more importantly will assist with prevention measures.

Workplace Violence insurance policies can be customized to include the coverage desired and most often can be packaged with a suite of risk management services. These services can include security audits, prevention and awareness coaching, active shooter training modules, and of course post crisis management. These services are invaluable to employees and organizations. According to the FBI, from 2014 – 2015, 60% of active shooter incidents ended before the police arrived. However, on six different occasions, employees or citizens successfully stopped an active shooter situation.

Workplace violence insurance policies will also provide coverage for threats of violence. For instance, if a disgruntled employee begins threatening violence to others within the organization, the cost of additional security and training could be included under the policy.

The landscape and environment in which we live and work is constantly changing, creating a myriad of fluid risk exposures and potential coverage gaps. It is imperative to proactively address potential threats to your business, employees, and customers. With its supplemental benefits and proactive services, a workplace violence policy can serve as an efficient way to transfer some of those exposures away from your organization.

Matt Cail is a client advisor in Sterling Seacrest Partner’s property-casualty insurance practice. He can be reached at 912.544.1927 or mcail@sspins.com.