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The Construction Industry is Reducing Insurance Related Costs with Technology

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Over the past several years, the construction industry has been positively booming with new technology. Traditionally, construction has been one of the least digitized industries, so there was plenty of room to grow.

One of the largest focus areas for growth has been technology improving worker safety. Reducing injuries, insurance claims, and fatalities is undoubtedly a great area to focus on when developing new tech.

Safety technology focuses on a few key areas: improved training, worker tracking, worker engagement, and predictive analytics.

With the introduction of wearables, drones, mobile devices, artificial intelligence, and machine learning into the industry, we can notice great strides in these areas. All of these technologies are striving to achieve one common goal: a safer job site.

Insurance Companies Investing in New Technology

Insurance companies who provide workers compensation and general liability insurance are keeping a close eye on these new technologies. With the potential to improve site safety and reduce the number of claims on projects, they prove to be very intriguing.

Actually, the insurance industry has already started investing in these new technologies. AIG and XL Catlin, for instance, have invested in construction wearable technology companies like Human Condition Safety and Pillar Technologies, and more are likely to follow. Real-time safety data that can be collected from the job site is another exciting new development. The data can be utilized for predictive analytics and can be used to address potential risks related to job sites, companies, and contractors.

This pattern is not new, however; insurance companies have been investing in and giving discounts for using specific technologies for years. Still, this is rapidly growing in our industry. In the end, insurers are interested in any tools that can help reduce claims, and they believe technology is one of those tools.

Can Technology Solutions Truly Reduce Cost?

As contractors continue to deploy more technology onto the job site to reduce risk and injuries, the real question remains: can it affect the bottom line?

If technology can help us avoid as little as one injury, the savings are over $25,000.

With this much on the table, technology seems inexpensive. For insurance companies, this means fewer claims paid and more profits. For contractors, specifically those in CCIP and OCIP programs, this will reduce deductibles and out-of-pocket expenses and in turn increase margins. This may also mean better rates for contractors on their insurance premiums. Insurance companies are known for evaluating safety systems in place to help determine risk and, consequently, the rates. Using best in class technology solutions along with a proven process to identify and prevent potential incidents on the job site will show insurers that you are a low-risk company. Therefore, investing in technology to improve job site safety can help drive dollars to the bottom line.

Choosing the Right Tech to Reduce Risk

As we mentioned previously, there has been a significant amount of development in the safety technology front. How do you choose the right ones?

Start by talking with your insurance carrier. They insure thousands of clients and very likely already have a team dedicated to staying on top of such technologies. They may even suggest some partners that will provide a discount. Also, look to the leaders in the industry, those who have been piloting and using these technologies for some time. Usually, if ENR top 100 contractors are utilizing these solutions, there is some merit to them. Finally, see for yourself, get a demo, do a pilot, and test it out. This is the only way to know if it will work for you.

Without proper engagement from workers and employees any of these technologies will fail. It is vital you make sure your organization is ready for them. In the end, there are a lot of great solutions out there for any budget; the key is to find the one that will have the most impact for your business.

When choosing to invest in worker safety, no investment is too small.

Learn more here about how Smartvid.io can help your project teams identify safety hazards and reduce the risk of incident.