Attorneys for injured parties often sue the employee, as well as his employer for its deep pockets. A company's liability coverage usually has a greater dollar value than a person's.

In 2007, International Paper (IP) settled a suit for $5.2 million with an Atlanta woman who lost an arm after being rear-ended. The IP employee was driving a company car while on her IP-issued cell phone.

In 2001, a Florida jury awarded $21 million to a car passenger hit by a salesperson using a cell phone while driving. Who paid? The firm.

Courts have even ruled against corporations when employees use their personal phones for business calls. In 1999, a Pennsylvania investment firm paid a $500,000 settlement to the family of a motorcyclist killed by an employee driving while making a work-related call after hours on his own cell.

Zurich's risk engineers have studied the hazards of distracted driving and issued a white paper on the topic. Chilcott and Transportation Secretary Ray LaHood share tips.

• Grasp the risk. "Recognize the liability that your company faces from mobile communication devices," Chilcott said. "Not just the dollar amount, but also the reputation risk, especially if it makes news headlines all over." Negative publicity can keep clients away.

• Craft guidelines. Every firm needs a phone strategy specific to its business. If you own a logistics and delivery outfit, your plan should cover your truck drivers as well as your executives. "The stricter the better, but devise something you can enforce," Chilcott said.

LaHood agrees: "My message to employers is this: Put the safety of your employees first. That means enacting strong policies banning distractions behind the wheel."

• Stay alert. Clarify that even hands-free calling in the car is dangerous. Scientists say phone talk limits a driver's attention. A study from the Highway Loss Data Institute published in February reviewed car claims from three states and D.C. amid phone-against-the-ear bans. They found no crash reduction.

• Communicate. Start by rolling out the policy and explaining it at a safety meeting targeting every single person at the company, Chilcott says. Put it in the newsletter. Hold additional gatherings and repeat yourself until it sinks in.

• Call it. "The communication must come from upper management," Chilcott said. "You can't just have the foreman or safety managers give a talk (to truck drivers), but then allow senior managers to drive around using their cell phones. Managers must lead by example."

Armand Fernandez, Zurich's chief risk engineering officer in North America, starts every phone call with: "Who's driving? If you're driving, get off the phone or pull over."

• Be their coach. Don't just print out a copy of your cell phone policy and ask employees to sign it. "This isn't a one-time thing," Chilcott said. "Retrain often. Make sure everyone understands the liability."

• Be patient. "Compliance won't come overnight," Chilcott said. "It'll take a while for the message to sink in. It'll require a cultural change."

Source: Investor's Business Daily