Article by Philippa Wild, Head of Commercial Business at Santam
Building a business is one of the hardest – and most rewarding – things any entrepreneur can do. Having invested so much time and human capital, it would only be prudent to protect what you have built. Businesses are exposed to many risks, from the traditional fire and natural perils related events, motor losses, to legal liability for loss of or physical damage to tangible property and/or death, bodily injury, mental injury, illness or disease of or to any person; it is imperative that businesses take out the correct insurance product to protect themselves against these types of risks. Further to this, businesses also run the risk of potential accidental injuries or death of employee(s).
With respect to the health and safety of employees, the common law right to hold the employer liable was removed by the Compensation for Occupational Injuries and Diseases Act, No 130 of 1993 (COIDA). This provides for compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees in the course of their employment, or for death resulting from such injuries or diseases. For brokers, this is an essential part of the ongoing risk evaluation and coverage advice to business clients.
Philippa Wild, Head: Commercial Business at Santam says “all businesses must comply with the Occupational Health and Safety Act of 1994, which provides workers with rights to health and safety in the workplace and stipulates the precautions workers should take for their own health and safety. Businesses that tend to have better than average health and safety practices, tend to also have better than average business risk management practices in place to protect themselves from traditional losses. These traditional losses may be insured under the business’s insurance policy.”
However, not all businesses are equal. While it is important that every company, no matter how small, prioritises the health and safety of its workers and ensures the working environment protects both workers and shareholders’ interests, certain businesses need to implement safety protocols more stringently. Wild elaborates, “Companies that involve public access or provide services to the public and minors, or have a manufacturing component where machinery, physical conditions or substances can lead to potential sickness, injury or death, must ensure they adhere to the Consumer Protection Act 68 of 2008 and the Compensation for Occupational Injuries and Diseases Act 130 of 1993.”
The COID Act allows employees to claim if they are injured or contract a disease while working, training or completing an apprenticeship; the Act also allows family members to claim if they have lost a family member who died while at work from a work-related incident or completing an apprenticeship.
To ensure a business complies with the employee and property safety regulations, Wild advises the following:
- Do ensure the business has a process for health and safety that includes the identification and analysis of risks, risk controls and continuous evaluations to ensure that the wellbeing of employees is prioritized.
- Do not allow an employee to undertake work unless precautionary measures to protect the employee have been undertaken and enforced in the interests of health and safety of the employee.
- Do ensure a health and safety representative and committee is appointed to oversee health and safety matters if the business has more than 20 employees. The committee needs to meet every three months.
- Do not allow an employee to use machinery or products that can cause injury or death if they are not trained or competent to do so or are not being supervised by a person who is trained to understand the hazards associated with it.
- Do ensure all employees understand the hazards to their health and safety within the workplace – including machinery, articles or substances that are produced, processed, used, handled, stored or transported – and the precautionary measures they must take with respect to these hazards.
- Do not forget to designate in writing, the company’s health and safety measures, representatives and committees.
Wild concludes, “It is important to note that having good risk management practices, safety training and education can influence business insurance premiums as they help reduce the frequency of claims and highlight a business owner’s intention of reducing their susceptibility to losses. This, in turn, helps the business get a better insurance premium. Most importantly, these measures protect the businesses’ most valuable asset – its people.”