Workers' Compensation Considerations for Terrorism Analyses

Employees who are inside or near a building targeted in a terrorist attack could sustain injuries from the blast itself, from flying glass and other airborne debris, or from collapsing building structural components.

The total losses due to workers' compensation depend upon:

• Number of employees in the building

• Time of day of the attack

• Construction type, occupancy category, and number of stories of the building

• Expected workers' compensation benefits, including indemnity claims for loss of income due to injuries and medical expenses

The AIR Terrorism Model considers four levels of injury severity, which are in accordance with FEMA's HAZUS® methodology (1999):

Minor

Basic medical aid that can be administered by paraprofessionals is sufficient.

Moderate

The use of medical technology, such as x-rays or surgery, is needed, but the injury is not life-threatening.

Life-threatening

Injuries pose an immediate life-threatening condition if they are not treated expeditiously.

Fatal

Person is killed instantaneously or mortally injured.

Coding Your Workers' Compensation Exposure Data

For each location in your exposure set, code your workers' compensation exposure data to include the following fields:

• Number of employees

• Percent of employees on the day shift (9 a.m. - 5 p.m.)

The following data is optional:

• Percent of employees on the evening shift. Not used for terrorism analyses at this time. The model assumes that attacks occur during the day, when the largest number of employees are present.

• Percent of employees on the night shift (7 p.m. - 7 a.m.). Not used for terrorism analyses at this time.

• Annual payroll. Not used if you entered Number of Employees above.

• Average Annual Wage. Not used if you entered Number of Employees above.

• Average expected payment for minor medical injuries.

• Average expected total medical and indemnity payment for moderate injuries.

• Average expected total medical and indemnity payment for major injuries.

• Average expected total medical and indemnity payment for fatal injuries.

If this data is not available, you can use Touchstone's default data. Touchstone uses statewide average cost estimates by injury type, which are derived from actual claims data.

For an industrial location, the default occupancy rate is 80% of employees on the day shift. For a commercial location, the default occupancy rate is 98% of employees on the day shift.

Overriding Touchstone Default Wages and Benefits Data

Users can override Touchstone default values for wages and benefits before importing Workers' Compensation exposure data.

To override the default wages and benefits data, do either of the following:

• Code your custom default values into the exposure data file.

• Set new defaults in the Loss Defaults > Wages and Benefits section of the Administration Console. Find the record for the relevant state and occupancy class. Click the fields you want to change and then replace the values in those fields.