RI 2733 Compensation Insurance Rates As A Measurement Of Accident Prevention In Mines

"""Hazard"" is the general expression used by safety engineers to denote risk, or the danger to property or human beings from the contingencies peculiar to different industries. Where a business, family, or individual is subjected to possible financial loss from any particular hazard, it is customary and is considered good practice to insure for reimbursement of possible loss. Accordingly, we take out insurance for earthquakes, for fire, for accidents, etc., and are charged a different premium for each. The premium rate is based on our relative exposure to the hazard in comparison to the total loss to our particular class of business in our geographical location over a given period.Insurance, then, must be considered as the experience of a group rather than of an individual, and any individual may be fortunate or unfortunate over stated periods. Through the law of averages, the probability of loss because of exposure to hazard is becoming more accurately measured as experience is accumulated and data are analyzed.Lion human life came to have a financial value in the eyes of the law, and employers were held liable for losses through accidents to employees while on duty, insurance companies began to underwrite the accident risks of the different employers and divided them into classes based on the amount of risk involved. Premiums for compensation insurance are based on relative exposure, which is measured by pay roll. The premium is rated in proportion to the severity of losses established by statistical studies.' It soon became evident that the accident experience of employers in the some industry varied widely; that is, there were good and bad risked in the same line of business. This resulted in ""experience rating"" of premiums, meaning thereby that an employer with experience in accident cost was premium rated in proportion to his losses over a stated period (usually three or more years)."