Those Darn Tenant Losses: Causes
If you are a landlord, insure habitational risks, or have the responsibility for placement of insurance, then you know there are many possible scenarios that can cost you money, but the number one loss driver is fire caused by tenants.
There is a long laundry list of crazy and preventable causes for these fires and certainly some scary statistics, especially for those of us with families to protect. But when warnings on everything from space heaters to candles and power cords fail to prevent accidental fires, what can be done to help protect landlords and tenants from potentially severe losses?
This is Part One of a two part series. First, let’s look at some common fire causes on tenant properties. In the next article, I will focus on what we, as an insurance community, can be doing to provide a solution for these inevitable issues.
Candles can be romantic, set the mood or simply just be the cheapest way to provide light, but they are also a common cause of fires by tenants. Tenants frequently forget about their lit candles and leave them unattended.
When warnings on everything from space heaters to candles and power cords fail to prevent accidental fires, what can be done to help protect landlords and tenants from potentially severe losses?
These forgetful tendencies can lead to a very unromantic turn of events when you find yourself standing outside your building with your neighbors watching firemen extinguish a fire that spread through the entire building including your home.
Smoking is another major cause of fires. Many fires are created by tenants who smoke in units that have oxygen tanks or fall asleep with a cigarette still burning. Both of these examples are extremely dangerous and well-publicized, yet remain a leading cause of fires.
Heating and electrical issues are also primary causes of fires by tenants. Every winter, there are tenants who forget to turn off their portable space heaters, both electrical and fuel-based, creating vulnerability to possible dangerous outcomes. And then, unfortunately, some tenants forget to turn off the stove before leaving their unit.
Children playing with fire are yet another obvious, yet quite common, source of dangerous problems. We all hear stories of kids playing with matches or a lighter, without fully comprehending the risks, which can lead to very serious accidents.
The most outlandish story that I have heard is of a tenant setting a cat on fire that ran around the apartment, creating a full-unit fire. Wow.
Clearly, the list of causes for tenant fires can go on and on, from the common causes to the more unconventional. And it seems most of these fires can or should be prevented, controlled, or managed better.
However, it has yet to be determined or made clear who exactly is responsible for these fires. It’s hard to manage a fire (and the losses they cause) without determining who is culpable and pursuing actions to mitigate and prevent future instances.
With all of these fire drivers and losses, what are the landlords and their insurers to do? Stay tuned for Part Two with a proposed solution.
I recently attended a conference of insurance professionals and the conversation centered around “Big Data.” It was a captivating presentation that only a risk and insurance professional could love. It certainly got my attention and it got me thinking about how I collect and use data to identify exposures in my work.
Risk management sets itself up to be the poster child for big data. As risk professionals we’ve been using big data for decades.
Through modeling, trending, forecasting, and claims management we have been on the forefront of what just now seems to be getting everyone else’s attention. And with the cost of technology so cheap, the ability to collect all types of data is mind boggling.
But this lends itself to the question, “Just because I can measure and model it….do I need to?”
Let me explain.
It was during this conference that a data specialist discussed the use of big data and how his company had applied it to a model to validate the impacts of water run-off and flooding. After collecting their data and running it through a model they were able to say definitively that water tends to pool at the lowest elevations.
Further, if a building is constructed in these low zones it is more likely than not that they will be adversely affected by floods versus building on higher ground.
Really? You needed to model that theory?
Now to be fair their work wasn’t finished. They are still working on positive impacts of a variety of options for engineering controls. Clearly, that will be useful when it comes time to design, budget, and build in these areas.
Through modeling, trending, forecasting, and claims management we have been on the forefront of what just now seems to be getting everyone else’s attention.
We are all working hard each day to identify and control risks to our company. And big data has a place, a very important place, in our work.
But as I listened to this presentation I wondered if maybe we are becoming too dependent on technology, models and big data and losing a skill that is just as important.
I call it battle scars but you know it as real experience. It has been said that we don’t learn from success; we learn from failure.
Now that doesn’t mean we have to experience a total loss in a flood zone to learn it’s not a good idea…especially if high ground is just down the block. But the lessons learned from battle scars can be invaluable.
That’s why I think, in addition to the collection and use of big data, it is just as important to set up environments where it is safe to experiment. Try new things. And know that you will fail. But failing is learning. It’s a good thing.
Just try to fail fast, fail cheap, and fail forward.
RIMS Recap: Tech Trends that Could Change Everything
Last month, Gordon Clemons, CEO and Chairman of CorVel Corporation, presented at the RIMS Conference in New Orleans, La. about emerging technology and how it is impacting risk management and workers’ compensation. The discussion served as a springboard for new insights on how technology will change the industry, and reaffirmed the need for integrated systems and human interaction for the best results.
The presentation noted the future is here – and technology is constantly evolving in hopes of outpacing tomorrow’s needs. As these technology platforms become more inherent in daily life, the gap in translating their utilization to workers’ compensation will begin to close.
Technology in Healthcare
While many consumer-based technology advancements exist in other industries, perhaps most notably in the retail space helping vendors to reduce various delays in the sales experience, people may forget that healthcare, too, is a consumer industry. And as such, healthcare also experiences workflow lags, which can be collapsed.
While patients and claims may not lend themselves as freely to mobile applications and technology that subscribes to the “Internet of Things” philosophy, the rapid rate of development foretells the not-too-far-off arrival of the “a-ha,” “wow factor”-type application that consumers are seeking in the healthcare industry.
Once we get there, we can only expect that the Pangea of resources will yield better outcomes. The potential impact to medical management includes more affordable/accessible healthcare, patient convenience, personal assistance, automatic inputs to claims systems and less administration from both patients and injured workers.
“Healthcare is stubborn about change. There are more data points in healthcare and there is a greater need for high quality and accuracy,” Clemons said.
Tech Trends for the Next Digital Decade
As an industry advocate in all things innovation, CorVel has been keeping tabs on emerging tech trends. As they begin to influence in other industries, it sparks the question – will they eventually change workers’ compensation?
Here are some of the trends on CorVel’s radar:
Smart phones and tablets were the first mobile devices to really start to gain traction across people’s personal lives. Since then, wearables (like Fitbits and smart watches) have been part of the next digital generation to be taken up by consumers.
As these personal devices quickly advance, wearables could offer payors and employers added insight into the wellness of claimants through the extent of their retrievable data.
Beacons are devices that use low-energy Bluetooth connections to communicate messages or triggers directly to a smart device (such as a phone or tablet). Retailers have started using this technology, sending offers to near-by consumers’ phones. Now the concepts of smart mirrors and smart walls offer a one-stop-shop with recommendations related to the preferences of the shopper – making a hyper-efficient business model. It is possible that we could see these devices adapted to being a catalyst for healthcare’s business model by reducing the delays of administrative work.
Formally known as unmanned aerial vehicles (UAV), drones can be remote-controlled or flown autonomously through pre-defined flight plans within their internal systems. Some carriers are testing the use of drones to potentially be used to evaluate property damage and responding to natural disasters.
As most injuries reported in workers’ compensation are musculoskeletal injuries, the industry lends itself well to the benefits of telecommunications and telemedicine. With the rise of electronic capabilities, telemedicine becomes another option to help guide an injured worker through their entire episode of care, reducing time delays.
In order to get to that point in time, implementing these trends (and those that are yet to be launched) will only be as successful as the population willing to accept them. Buy-in will require a commitment to the long-standing pillars of the industry. According to Clemons, “While technology can truly move the needle in workers’ compensation, it will take more than bells and whistles to maximize its impact.”
“People’s feelings are valid. The skepticism surrounding new technology is not misplaced, but neither is the enthusiasm,” Clemons said.
New Trends, Same Priorities
Beyond the buzzwords and hype surrounding the latest apps and devices, for new technology to succeed within the workers’ compensation realm, it boils down to the two primary concepts that drive the industry to begin with – effective infrastructure and a people-first philosophy.
The power of applicable resources and the actionable data that results from them is in the foundation of the systems themselves; that primarily being through the influence of integration. It is not a new concept; however, as technology advances and the reach of analytic capabilities broadens, it is important to find a provider that can harness this data and channel it into effective workflows to increase efficiencies and promote better outcomes.
CorVel’s proprietary claims management system has been developed and supported by an in-house, full-time information systems division to be intuitive and user-friendly. Complex, proprietary algorithms link codified data across the system, facilitating collaboration between services, workflows, customers, and technology and eliminating the risk that a crucial piece of information will be missed. The result is an active “ecosystem” providing customers with actionable data to provide the most accurate, comprehensive picture at any time, while also collapsing inherent delays.
For the injured worker, the critical human touch connection in the workers’ compensation process can never be minimized. By cutting lag time throughout the various inefficiencies underlying the industry’s workflows, CorVel can connect injured workers with quality care sooner. As systems advance, claims and managed care associates do not have to spend as much time on administrative work and will instead be able to devote more time to the injured workers, reviving the human touch aspect that is just as impactful within the industry.
Regardless of the technology that lies ahead, CorVel looks to the future with investments in innovation, while not losing sight of their role and responsibility to clients and patients. Dedicated to constant improvement for the services they provide injured workers and industry payors, CorVel is committed to improving industry services one app, click, drone (or whatever is yet to come) at a time – perhaps something to discuss in San Diego at next year’s RIMS conference.
For more information, visit corvel.com.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with CorVel Corporation. The editorial staff of Risk & Insurance had no role in its preparation.