Can Machine Enclosures Reduce Your Workers Comp Costs?
If you run a manufacturing floor, you already know what workers comp costs you. What you might not have thought about is how much of that cost traces back to machines that aren’t enclosed.
Coolant on the floor, noise that’s been a known problem for years, dust or mist that nobody’s quite gotten around to addressing. These are the kinds of things that generate claims, and the claims are what drive your premiums up.
In this article, we’ll look at how machine enclosures reduce workers comp exposure, what the actual numbers look like, and how it all affects your premiums.
The Claims Enclosures Prevent
Workers comp claims in manufacturing tend to cluster around a few categories, and most of them are things an enclosure can help with.
Slips and falls. Coolant overspray, oil, metal chips on the floor around a machine. According to the National Safety Council, the average workers comp claim for a fall or slip costs $54,499. An enclosure keeps that mess contained, and the floor around the machine stays dry and clean.
Hearing loss. About 38% of manufacturing workers are exposed to hazardous noise levels, according to CDC/NIOSH. And roughly 20% of noise-exposed manufacturing workers who’ve been tested have hearing impairment severe enough to affect speech comprehension. An enclosure with sound-absorbing materials can reduce noise at the source, which is what OSHA’s hierarchy of controls calls for. In some cases, it brings noise below the 85 dBA threshold where a hearing conservation program kicks in.
Airborne contaminants. Dust from metals, coolant mist, fine debris. When these are in the air, you’re looking at respiratory protection requirements under OSHA 1910.134, which means fit testing, medical evaluations, training, and ongoing program management. An enclosure with proper ventilation and filtration keeps that contained.
Contact injuries. Caught-in or caught-between injuries from exposed machinery average $47,749 per claim, according to the NSC. Enclosures add a physical barrier between operators and moving parts, which is a straightforward control.
How Claims Affect Your Premiums
This is the part that makes it a financial question and not just a safety question.
Your workers comp premium isn’t usually a flat rate, but adjusted by something called your Experience Modification Rate, or EMR.
The EMR compares your claims history to what’s typical for businesses in your industry and size class.
An EMR of 1.0 means you’re average, and below 1.0 means fewer claims than expected, which lowers your premium. Above 1.0 means more claims, which raises it. This is simple enough to understand.
What makes it sting is that the EMR is based on three years of claims history. So a bad year may not just cost you the claims themselves. It may also raise your premiums for the next three years. Insurers tend to weigh claim frequency more heavily than severity, so a handful of smaller claims can hurt more than one large one.
If you’ve got a machine that’s been generating slip-and-fall incidents, or a noise source that’s led to hearing loss claims, these costs may compound in the wrong direction.
Running the Numbers
If you’re mulling over whether an enclosure makes financial sense, here’s a solid starting point.
Begin by looking at your claims history for the past three years. How many of those claims are tied to a machine that isn’t enclosed? (Slips around it, hearing exposure from it, contact injuries near it.)
Then check your compliance costs. How much are you spending annually on hearing conservation, respiratory protection, and PPE for workers around that machine?
You can also factor in the EMR. If those claims are pushing your modifier above 1.0, you’re paying a premium surcharge every year until they age off your record.
For some facilities, the math is pretty obvious. The enclosure may pay for itself through reduced claims, lower premiums, and eliminated compliance costs. For others, it might be closer.
Either way, it’s worth knowing the number.
If you want help thinking through it, reach out to us at MachineEnclosure.com. We can walk through what an enclosure would look like for your situation and help you understand the cost picture.
