The Arizona Republic: Business
By Russ Wiles, personal finance reporter
July 17, 2010

The sluggish economy has been tough on a lot of sectors, including banks, construction firms, retailers, real-estate companies, and state and local government entities.

But property/casualty-insurance companies seem to be holding up relatively well and might even be enjoying a recession tailwind of sorts.

Insurers operating in Arizona have noticed some positive trends related to the economic slump, such as fewer auto crashes and even a mild decrease in workplace injuries and fatalities.

"Recessions do have some impact on behavior, especially driving behavior," said Ron Williams, executive director of the Arizona Insurance Council. "When those behaviors lead to reduced losses and reduced risks in the workplace, at home and on the road, the insurance industry can be more competitive in pricing."

So far, Arizona's insurance industry doesn't seem to be hurting much from the economy, although industry figures are lagging.

Statewide claims and losses for property/casualty insurers rose only modestly to $5 billion in 2008 from $4.8 billion in 2007, according to the Arizona Department of Insurance, citing the most recent figures. Premiums collected fell slightly to $8.2 billion in 2008 from $8.5 billion the prior year.

Nor have insurers announced many big-scale layoffs or retrenchments here. Roughly 940 property/casualty firms employing 37,000 people operate in the state.

At a safety-focused industry seminar hosted this week by the Arizona Insurance Council, the big news might have been how few unfavorable developments have befallen the industry and policyholders of late.

For instance, workplace fatalities in Arizona in 2009 dropped to their lowest level in at least two decades, said Darin Perkins, director of the Arizona Division of Occupational Safety and Health.

"I'd guess a lot of that is due to the economy," Perkins said. "A lot of people just aren't working."

Nor are they working as much in more dangerous occupations such as those in the construction field. Most workplace deaths and injuries result from transportation mishaps, falls and electrocutions.

Roughly 4 percent of workers were injured on the job in 2008, the most recent year for which data are available. That was down from 6 percent in 2000.

"Again, the economy has a lot to do with it," Perkins said. "There's a slowdown of work all over."

People also tend to drive less during tough economic times, and fewer cars on the road translate into fewer accidents.

For example, auto fatalities dropped during the latest recession, as they have in every recession over the past six decades, said Alana Shacter, an epidemiologist with the Arizona Department of Health Services, who also cited ongoing vehicle-safety improvements and other factors for the positive trend.

Meanwhile, statewide deaths from home fires fell to 35 in 2009 from 63 in 2008, said Robert Barger, Arizona's state fire marshal, who didn't cite a reason for the decrease.

But while the economic slowdown is reducing some accidents, it's causing problems in other respects. For example, government budget cuts mean fewer safety inspections.

Barger said his department would like to inspect every elementary school here once a year. But with a staff of just eight, "an inspection every two to three years is more likely," he said.

While some accident numbers have dipped, the financial impact doesn't always drop because of medical inflation, escalating legal costs and other pressures.

"Most of us agree the frequency of (insurance) claims is going down," said Rick Jones, president of SCF Premier Insurance Co. "But the severity is going up."

State officials and insurance-company representatives cite many ways to reduce the chances of accidental injuries or deaths:

• Be careful in winter. Home fires are more common in cooler months when people light candles and fires and use other energy sources they're not used to dealing with, said Robert Barger, Arizona's state fire marshal

• Pay attention to poisons. Death by poisoning, including drug overdoses and reactions, account for nearly half of all home fatalities, said Alana Shacter, an epidemiologist with the Arizona Department of Health Services. That's much more than fires, falls or child drownings, which often get more publicity.
"Know what medications you're taking, and make sure they're not working against each other," she said.

• Careful in the kitchen. "Cooking equipment is always the Number 1 cause of (home) fires," Barger said. Children and younger adults are more likely to be burn victims.
"Keep kids out of the kitchen while you're cooking," Shacter suggests.

• Install smoke detectors if you don't have them. For more fire protection, consider adding a home-sprinkler system.

• Watch for padlocks. The worst fire fatalities often come at schools, nightclubs or other buildings where doors have been locked from the outside. "Chained facilities are dangerous," Barger said.

• Careful on the road. Wear seatbelts in cars and helmets when on bicycles or motorcycles.

• Avoid emergency rooms for poisoning cases if you can. Before rushing to the hospital, Shacter suggests seeking less costly and possibly faster help by calling a Poison Control Center (1-800-222-1222). You also can receive tips on venomous stings and bites.

• Encourage your teen to minimize distractions while driving. Teen drivers often are more prone to accidents if they have friends with them.

"One young driver (alone) usually doesn't do the wrong thing," said Jeffrey Williamson, a sergeant at the Arizona Department of Public Safety. In addition, he discourages motorists from making phone calls or texting while driving.

DPS sergeant predicts rise in collisions with end of speed cameras on state highways

Don't be surprised if Arizona's favorable auto-accident trend reverses with the elimination of the state's photo-enforcement program this week.

"We've seen a steady decline in collisions," said Jeffrey Williamson, a sergeant with the Arizona Department of Public Safety, citing photo-enforcement cameras as one factor.

Arizona logged nearly 8,800 auto collisions in 2007, the last full year before speed cameras were installed, Williamson said at a meeting of the Arizona Insurance Council on Thursday, the final day the state's cameras were operating (some cities will still use them). That rate fell to below 6,000 crashes in 2009.

He cited one study that estimates photo enforcement helps to reduce average driving speeds by 9 miles per hour. Plus, the cameras free highway officers to do other things, such as monitor for drunken driving.

"As a whole, photo enforcement does its job," said Williamson, who predicts a gradual rise in traffic problems with the program's conclusion.

Read more: http://www.azcentral.com/business/articles/2010/07/16/20100716biz-Insurance0717photo.html#ixzz0tye1vDbo