Turning Insurance Loss Runs into Actionable Risk Intelligence
Insurance loss runs are often viewed primarily as documents needed for policy renewals or underwriting reviews by insurance carriers. But they can also provide valuable insight into where risk exists within an organization and where action may be needed.
A loss run tells the story of what has already happened. By analyzing that history for patterns, contributing factors, and recurring exposures, organizations can use past losses to make better risk decisions going forward.
Understanding the Loss Run
A loss run is a report, typically issued by an insurance carrier, that provides a record of the claims reported under an organization’s policies over a period of time. While total claim costs are important, they are only one part of the picture. A useful analysis should consider claim frequency and severity, types and causes of losses, locations and operations involved, timing and recurrence, open and closed claims, and reserves and claim development. The value of any analysis depends on the quality and consistency of claim coding, incident reporting, and data collection.
It is also important to consider the relationship between frequency and severity. A single high-severity claim may immediately command attention, but recurring smaller claims can be equally important. A series of similar incidents may indicate an exposure that has become embedded in an operation, creating an opportunity to address the underlying issue before it contributes to a more significant loss.
Look for Patterns in the Data
Reviewing claims individually can tell you what happened. Looking at them collectively can reveal where losses are concentrated and what may be contributing to them.
Start by segmenting loss data in ways that reflect the organization’s operations, such as by location, department, job function, vehicle type, task, incident type, or time period.
Then look for trends:
Organizations may also benefit from comparing loss trends against industry benchmarks to determine whether certain exposures are unique to their operations or common within their sector.
Loss runs can become even more useful when considered alongside near miss reports, safety observations, training records, inspection findings, and operational data. An increase in claims involving new employees, for example, could be compared with onboarding and training records. A concentration of vehicle incidents could be reviewed alongside driver observations, transportation routes, vehicle types, and maintenance information.
Connecting these sources can provide a clearer picture of the exposure.
Identify Root Causes
Once a pattern has been identified, the next question is why it is happening. Contributing factors may include procedures, training, equipment, maintenance, staffing, workload, supervision, driver behavior, facility conditions, or process compliance.
Organizations may want to be careful about drawing conclusions from individual incidents. If similar incidents occur repeatedly, there may be an operational or systemic issue contributing to them.
Repeated backing accidents, for example, could involve driver behavior, but they could also point to parking configurations, delivery routes, limited visibility, spotter practices, or training gaps. Recurring strains may warrant a closer look at material handling, ergonomics, equipment, or workload.
Effective loss analysis moves the conversation from “What happened?” to “Why does this keep happening, and what can we change?”
Turn Insights into Action
Identifying an exposure has limited value if nothing changes as a result. Organizations can prioritize risks based on frequency, severity, and potential impact, then develop corrective actions specific to the exposure. Backing accidents may call for changes to routes, parking practices, training, spotter requirements, or technology. Strain injuries may require changes to material handling or ergonomics. Claims involving new employees may point to opportunities to strengthen onboarding, training, or supervision.
Determining what should change is only part of the process. Organizations may also want to consider establishing who is responsible, what success looks like, and how progress will be measured.
This is where key performance indicators (KPIs) and clearly defined goals become important. The familiar management principle “What gets measured gets done” applies to risk management. When a goal has a defined metric, an accountable owner, and a timeline, it can become part of how the organization manages performance.
If backing incidents are a recurring problem, for example, it may be helpful for the goal to go beyond “reduce backing accidents.” Consider establishing a measurable objective, assigning responsibility for corrective actions, setting a timeframe, and regularly reviewing whether incident frequency is declining.
When leadership establishes clear expectations and consistently reviews results, priorities often become clearer throughout the organization. Accountability can help drive action, while measurement can help show whether that action is working.
Loss runs are historical, but they can also help organizations look ahead.
Use Loss History to Anticipate Future Risk
Loss runs are historical, but they can also help organizations look ahead. Pairing loss history with leading indicators such as near misses, inspections, safety observations, maintenance findings, and employee feedback can help identify emerging exposures before they become claims.
If past data shows that incidents increase during rapid hiring or peak production, for example, leaders can strengthen training, supervision, or other controls before entering another period of elevated exposure.
Loss analysis can be most useful as part of ongoing operational reviews rather than an exercise reserved for insurance renewal.
Connect Risk Improvement to Business Performance
Losses can affect employees, customers, equipment, productivity, operations, claim costs, and business continuity. The financial impact often extends beyond the claim itself to include lost productivity, overtime, equipment damage, customer disruption, and administrative costs. That makes loss analysis relevant beyond the safety or risk management department.
The objective is to understand where meaningful exposures exist, determine which deserve attention, and make informed decisions about how to address them.
Make Your Loss History Work for You
Each claim represents something that has already happened. The opportunity is to determine what can be learned from it:
Then measure whether those efforts are producing results.
Used this way, loss runs can become a practical risk management tool, helping organizations use yesterday’s experience to make better decisions and help reduce the likelihood of future losses.
Acrisure Risk Resources can help organizations evaluate loss trends, identify opportunities for risk improvement, and develop strategies to help address exposures across their operations.
Contact us to find out more.
IMPORTANT NOTICE: This content is for general informational purposes only. The loss analysis and risk management practices described herein are general in nature, and their suitability and results will vary based on each organization’s operations, data, and circumstances. Organizations remain responsible for managing and mitigating their own risks, and nothing herein should be relied upon for the prevention or mitigation of losses or as an explanation of coverage under any insurance policy. This content should not be construed as legal, financial, tax, safety, or other professional advice. While the information provided herein has been compiled from sources believed to be reliable, no warranty, guarantee, or representation, either expressed or implied, is made as to its correctness, sufficiency, or adequacy.
Brian Fielkow helps Acrisure clients grow their safety cultures and manage risk with his executive, operational, and safety leadership. Fielkow has published several books and articles, including Leading People Safely: How to Win on the Business Battlefield, co-authored with James T. Schultz.
