Costs of Accidents

Did you know that the average cost of an eye injury is $1,463, when you consider all the hidden costs?

Accidents are more expensive than most people realize because of the hidden costs. Some costs are obvious — for example, Workers' Compensation claims which cover medical costs and indemnity payments for an injured or ill worker. These are the direct costs of accidents.

But what about the costs to train and compensate a replacement worker, repair damaged property, investigate the accident and implement corrective action, and to maintain insurance coverage? Even less apparent are the costs related to schedule delays, added administrative time, lower morale, increased absenteeism, and poorer customer relations. These are the indirect costs — costs that aren't so obvious until we take a closer look.

Studies show that the ratio of indirect costs to direct costs varies widely, from a high of 20:1 to a low of 1:1.

The more accidents that occur in a workplace, the higher the costs — both in increased insurance premiums and greater indirect costs.

Reducing the Costs of Accidents

OSHA strongly believes that an effective safety and health program is the answer and we have the results to prove it!

After focusing on its safety and health program, an Atlanta company reported that, from 1994 to 1996, their annual Workers' Compensation claim costs fell from $592,355 to $91,536, a savings of $500,000.
After implementing a 100% fall protection program and supervisory accountability for safety, Horizon Steel Erectors, Inc., had a 96% reduction in its accident costs per person per hour, from $4.26 to $0.18.

Other companies who value workplace safety and health, such as OSHA's Voluntary Protection Program (VPP) participants, have experienced significant economic benefits as a result of their excellent safety and health performance. Together, VPP sites in more than 180 industries are estimated to have saved more than $130,000,000 in direct and indirect costs in 1999.

Once you've decided to implement a safety and health program, where do you start? Read through some of the other sections listed on the left of your screen for more information.