The Financial Impact of On The Job Car Accidents
Car accident happens at an alarmingly frequent rate, but those that happen on the job can be even more of a nightmare. The National Safety Council found that vehicle collisions are the number one cause of death and injury in the workplace, with another report from vehicle management company Motus showing 40% of all accidents are work-related.
Those numbers are staggering, but the financial impact of on-the-job car accidents is even worse. A single crash holds the potential to cost any company roughly $1.4 million. Over the course of a company’s lifetime, the cost of accidents can total $66 billion in medical expense alone. Here’s the breakdown of how much these incidents total for businesses.
In 2017, the Motus study showed that vehicular accidents came with an enormous $56.7 billion price tag for employers. That number is broken down between medical bills, insurance increases, wage replacement for employees on leave, and property damage.
OSHA’s analyzation of that billion-dollar cost breaks down to an average price of $16,500 per accident, with the top end reaching $74,000. For fatal accidents, the top number rises to over $500,000. Where companies lose the most is employees missing work, which 53% of employees do after being injured.
One average cost that’s hard to calculate is legal expenses. Fees vary from one Bay Area car accident lawyer to the next in Tennessee, and any fees associated with court can also change from one county to the next. There’s also the variable factor of any court ruling against the company, provided they are at fault.
Indirect costs also come into play. While an employee is out, others on their team must take on extra work. Productivity can slip during this time and overtime pay is almost a given. Car accidents can also damage a company’s reputation, leading to downturns in business.
While paid leave is factored into average costs, it can easily become an ongoing one as well. Varying levels of injury can leave your employee in the hospital or recovering from home for long periods of time. Covering a few weeks might not be so bad, but serious injuries can leave workers unable to perform their duties for months.
The longer an employee needs to heal, the more a company’s indirect costs climb. When an accident is fatal, indirect costs also include the hiring process as well as any expenditure for onboarding processes and training.
Reducing the Cost
These statistics may seem to detract from the emotional and human cost of accidents, but they are something companies must consider after the fact. At least, they are for now. Each business in existence with employees who drive as part of their job has the option to decrease these costs by simply reducing the number of accidents their employees have. All it takes is a little training.
Corporate driver training is a proven method to keep your employees safer on the road. Studies show that companies who invest in training see increased seatbelt use, less compensation claims, reduced accidents, and lives saved. In most cases, companies saw a 35% decrease in annual costs related to crashes, which can translates to billions for larger entities.