Best’s Review

In August, 2004 Best Review, in a longer article on Liberty quoted Paul Condron as saying:

Paul Condrin, executive vice president of personal lines for Liberty Mutual, said the creed couldn’t be more appropriate. “What differentiates us from a lot of companies is the time and energy we spend in preventing the loss,” he said. In addition to employing more than 700 safety and health experts in the field to work with customers in preventing losses, the company’s 50-year-old Research Institute for Safety is devoted to studying the science of preventing losses

It also included a significant description of the Institute:

A.M. Best Company # 00060

Liberty and the Pursuit of Safety

You may not know the name of David S. Beyer, but he’s reached a hero’s superstar status at Liberty Mutual.

He didn’t excel in sports or music. He didn’t grace the silver screen.

Beyer was a safety engineer.

And the fact that he was the first employee hired by Liberty Mutual back in 1912 has become a legend at the company, which devotes a great deal of time, money and effort to studying why people get hurt at work, how to prevent those injuries and how get them back to work sooner.

Loss prevention is “the cornerstone of what we stand for,” said Karl Jacobson, senior vice president of loss prevention at Liberty Mutual.

The center of Liberty Mutual’s loss prevention is its Liberty Mutual Research Institute for Safety. Funded with an annual budget of $8 million, the research institute employs 46 staff members, including 25 full-time researchers who are devoted to studying the various aspects of workplace and worker safety.

It’s a sound investment, Liberty Mutual says. Workplace injuries caused $45.8 billion in costs in 2001, up from $44.2 billion in 2000, according to its 2003 Workplace Safety Index.

At any given time, there are about 70 different research projects under way in the institute’s 11 labs. The findings are shared with the world, including other insurance companies, through publication in peer-reviewed scientific journals.

Tom Leamon, vice president and director of the institute, said it’s important that the findings be published and accepted in the scientific community.

“Otherwise, why would anyone accept our opinion? They’d say, ‘that’s what you’d expect an insurance company to say,” Leamon said. “This gives us credibility.”

Many of the studies revolve around the three leading causes of workplace injury: overexertion, falls on the same level (as opposed to tailing from a height) and bodily reactions (injury caused by the body contorting in an attempt to avoid falling). those three causes of injury were responsible for 51% of workers’ injury costs in 2000, according to the company.

“It doesn’t matter what industry you are in: restaurant, manufacturer, office. I can tell you the cause of your major workers’ comp losses” Leamon said.

The institute spends a lot of its time studying slips, trips and falls, physical work and return-to-work programs.

After publishing its various findings–74 published last year alone–Liberty Mutual then uses the results from its findings to develop risk-management guidelines, which are proprietary. It shares those guidelines with the company’s more than 700 safety and health professionals in the field, who work with clients to improve safety. Each of Liberty Mutual’s business units has its own assigned loss prevention experts.

Over the years, Liberty Mutual’s findings have included such industry-changing concepts as guards to prevent workers from losing hands and fingers in machines to an emergency shut-off switch on escalators that prevents children and others from getting hurt if their shoes get caught under a moving step. Many of the company’s industrial findings have became standards utilized by the Occupational Safety and Health Administration and other domestic and international regulatory organizations, And the escalator emergency shut-off switch has been a building code requirement in the United States since 1960.

“We don’t do this because we want to create standards. We do this to reduce losses,” Jacobson said. “We consider ourselves business partners with our customers. We care about the long term. Preventing losses is a win/win for both of us.”

The institute often does joint projects with colleges and universities. For instance, in 1957 and 1961, the institute and Cornell University developed two “survival cars,” which were designed to show how safety measures could prevent vehicle crashes and injuries. The cars included 17 safety features, including seat belts, air bags, collapsible steering columns, headrests and special brakes that eventually became standard in U.S. automobiles.

If the institute needs to measure a particular factor, and there isn’t an appropriate measurement device in existence, it will design and create the needed tool. The institute holds several patents, including one for a machine that measures the slipperiness of floors. However, the institute’s focus is not on creating devices or seeking patents.

“We don’t want to design products. We create knowledge and others can use that knowledge to create the product. We are not in the business of producing patents,” Jacobson said.

It’s difficult to measure the impact the institute has had on Liberty Mutual’s bottom line, but that’s not the main goal of the facility either, Leamon said.

“My job is to give the competition an inferiority complex. They can’t go someplace else to have a better control of their risk. That’s a visible part of who we are,” Leamon said.

Located about 26 miles west of Boston, in Hopkinton, Mass., the 93,000 square-foot research institute is divided into two entities. The Center for Safety Research works to improve workplace safety by investigating the causes of workplace accidents and injuries, including studying how people respond physically to various tasks. The Center for Disability Research studies the causes, consequences and prevention of disabilities in workers, and helps to develop safe and sustained return to work for injured workers. The institute, which recently doubled its size with a new addition, is 50 years old.

While the institute is geared to do studies to share with the world, the institute also houses an operation specifically to improve Liberty Mutual’s personal claims handling. The institute includes a 14,000 square-foot claims training center where personal auto and homeowners adjusters learn first hand how to repair damaged homes and autos. In addition to classroom training, the center includes a working garage where adjusters–and even customer service representatives who answer phones–can learn the basics of how to repair damaged cars and homes.

The traditional-looking classrooms include garage doors that open up into a warehouse-sized facility. In addition to a working garage, where auto claims adjusters can learn how to pull a dent from a bumper or realign a damaged frame, the facility also includes a newly built, full-sized, two-story home where homeowners claims adjusters can learn about different building techniques and materials. The home includes some Plexiglas walls, so students can see the innerworkings–pipes and wiring–of a house, and how various types of sample materials can be used.

“They learn the terminology, which helps them interact with body shops and customers,” said Tom Smyth, director of technical training for Personal Markets.

Home adjusters attending a training program that spans several weeks actually build a small house-like shed, which is “damaged” by teachers, who spray red spray paint to represent fire damage. Then the adjusters estimate how much it will cost to repair the damage, and then, they repair the damage themselves to see how close they come to their estimate.

“It’s a great learning experience,” Smyth said.

Outside the facility is a three-acre auto training and testing track, equipped with sprinklers to wet the pavement. Using specially prepared vehicles, instructors can show participants-often commercial vehicle driver trainers, or fleet managers–driving techniques to use during difficult emergency driving conditions, such as when they have to stop suddenly, or the vehicle begins to slip into a tailspin skid.

“It’s one thing to tell someone what to do in an emergency. But that’s not likely to be as effective as letting them do it, and feel it, for themselves,” said Dave Money director of transportation training.

All aspects of the institute point to its motto, “From Research to Reality,” Leamon said. “There’s a difference between the perception and the reality of risk. Our mission is to do research, reduce risks and differentiate Liberty Mutual. Our purpose really is to help people live safer, more secure lives.”