Managing Snow and Ice Liability

Most winter weather management professionals agree that our job isn't "snow removal" anymore as much as "risk management". Yes, larger snowfalls or ice events can batter properties, but increasingly ominous is the ever-present world of liability - and the staggering dollars that come with it. It's the storm within the storm, and at all times we walk on thin ice.

 

The good news is that there's no question why we do what we do: outstanding margins, higher value to prospects as a vendor who can handle every job type, and a deep sense of fulfillment in contributing value and safety to our communities, subduing nature itself to reopen society.

 

Since the game is worth playing, the need is in how to manage our risks and liabilities. We seek ways to know our position and to proactively improve it. What makes risk management different from operational improvement is we deal with what hasn't happened yet, and we bring extra optimism to the table as this is a negative-centric conversation (avoiding bad outcomes) rather than a positive-centric improvement (gains, opportunities, and profits).

 

A complete risk management strategy, as well as its audits and improvement efforts, is a massive discussion, but here are a few consistently seen risks across the industry and the most common risk management strategies for each.

 

RISK: Overall Operational Liability

STRATEGY: High Quality Legal Contracts

A majority of cases in a majority of states rule in favor of the signed, valid contract whenever one is present. Without one, everyone is at the mercy of what people feel like happened (or should have). Whenever possible, have customers sign your agreement - preferably, one that includes an indemnity clause, politely advising your clients that you are their snow contractor, not their insurance company. For other contracts, a qualified lawyer can assess your level of risk.

 

RISK: Skyrocketing Insurance Overhead

STRATEGY: Contracts + Loss History Management

At the end of the day, insurance is a business looking to be profitable. As your company grows, so will your rates at some level, but much your rating is a combination of your historical risk - aka, "What has your insurance policy been forced to pay in the last 3 to 5 years?" - and your contractual risk - aka, "If an incident happens, is there a contract to govern what follows, and is it favorable or not?" The less claims you pay, and the less you look likely to pay, the better.

 

RISK: Workers Compensation Cases

STRATEGY: Training, Safety Equipment, and Agreements

In each area, ask yourself, "If something happens, what will people accuse we should have done?", then develop a plan. A rookie using complex equipment badly is unwinnable, so define your critical roles in advance and sign a rock-solid, qualified workforce. Disarming tensions after a "near miss" is easier when you can show documentation all employees underwent and passed a standard safety program. (Then audit the incident to coach against future violations.) Avoid unseen collisions, frostbite cases, and lower back injuries by buying safety vests, gloves, and ergonomic shovels. These easy fixes cost far less now than just a few true cases would later.

 

RISK: Division Profitability

STRATEGY: Mixed Contract Types

In many mid-markets snow seasons can be feast-or-famine, so consider a mix of contract types. Many young operations bill on a Time and Materials (T&M) basis, as that's the easiest, but many jobs are Per Occurrence (paid per visit & type of work done), or Tiered (paid per Storm Type), or even Seasonal / Fixed (one flat rate for unlimited service). Each job type has strengths and risks. For example, T&M jobs let you maximize big years' earnings but starve in the dry seasons; whereas Fixed jobs have terrible margins in big years but give you guaranteed income in dry seasons to cover company overhead. Try a blend of both.

 

RISK: Slip-Fall Lawsuits

STRATEGY: Weather & Mobile Documentation

Documentation is the difference between accident and negligent - aka, the difference between lawsuits seeking damages the size of their injury or damages the size of your insurance policy. To explain your team's strategy, capture official weather service data for storm forecasts, live radars, period of duration, condition, and outcome; these help "tell the story of the storm" later. To defend your excellent execution of that strategy, get a field services software solution that collects visit timestamps and before-and-after site photos.

 

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David Rempfer is a veteran operations leader of multimillion snow operations and one of less than 300 professionals in North America to be both ASCA Certified and SIMA Executive CSP certified. He now consults landscape and snow industry executives in their pursuits of business improvement and quality-of-life.

, Managing Snow and Ice Liability

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