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  • Writer's pictureKathryn Stagg

The Cost of a Collision

American dollar bills on a white background.
Photo by Emilio Takas on Unsplash

Being involved in a collision is a terrible experience for anyone, regardless of who is at fault. Collisions are traumatizing events. According to the World Health Organization (WHO), approximately 1.3 million people lose their lives every year as a result of traffic injuries. Millions more suffer injuries big and small, but even if you emerge unscathed, the experience of being in a collision can cause many to feel unsafe while driving.

Then there's the other aspect of collisions - their cost. Collisions can be very expensive. Depending on the damage to your vehicle, repairs can run from a few hundred dollars up into the thousands. If you own your own vehicle, it's likely one of the most expensive assets to your name, and the longer you've been driving, the more likely it is that you've been in a collision of some kind. Driving, and unsafe driving in particular, can be a pricey business.

But what if you are a company who employs drivers and is responsible for their safety? When it comes to collisions that occur while a driver is on the clock, whether they are in a person vehicle or a company-owned vehicle, the costs can be staggering, and in ways that many don't even consider.

On the face of it, it's easy to assume that the costs would remain the same regardless of whether the driver was working or not. I mean, why would a collision involving an employee-operated vehicle be more than costly than any other collision? And yet the reality is that there are a whole host of reasons why collisions incurred while on company time have additional costs.

Some of the reasons why company collisions can be more expensive are self-evident. A vehicle has been damaged, maybe even totalled, and needs to be repaired or replaced. If your company owns that vehicle, you bear that cost, as well as the cost of repairs to the other vehicle if your own driver was at fault. While insurance may cover some of the costs (or all if you're lucky), it's not uncommon to have to pay out of pocket up to a certain amount.

The same is true for medical expenses. Whereas a personal collision connotes personal responsibility for health care costs, collisions that happen on company time require the company to assume responsibility, for both their own driver and the other road user should they be the victim. This is especially true in countries that don't have universal health care. While insurance may help here too, it may not cover everything.

These are the obvious costs. At first glance, you may think they are the only costs, but unfortunately, this is far from the reality.

Uncovering the True Cost of Collisions

Consider the administrative costs. If a collision has happened on your watch, that means that a great deal of paperwork is going to need to be completed. Most companies will also conduct some sort of investigation into what happened, which involves time and effort that ultimately costs money. As the saying goes, time is money.

Drivers, managers, and anyone else involved in the administrative responsibilities that follow a collision are taking time away from work to deal with the situation. That means that time is lost that would otherwise be used in business pursuits.

If a driver has been injured, they may have to take time off work, which can lead to a temporary employee shortage. If the injuries require long periods off work, that could lead to a need to recruit and hire additional employees. Most companies also cover at least some of the salary for an injured employee. Once you've brought new people on board to keep business running smoothly, they require training, perhaps certification and, as with most new employees, will take a few months to reach optimal productivity.

Finally, there's also the costs associated with damage to a company's reputation. If a vehicle owned by your company is involved in a collision, then that reflects on your business. The bigger your brand is, the more at-risk you find yourself for bad press or bad reputation.

The Importance of Understanding the True Cost

Understanding the true cost of a collision to your business is incredibly important. Not only because it makes good financial sense, but because it's an important part of gauging the scope of your problem and the size of solution that is required.

Any company that employs drivers wants those drivers to be driving as safely as possible. When collisions occur, and especially when they occur frequently, making changes to ensure that vehicles are being operated safely is one of the best things you can do.

A lot of companies shy away from driver safety solutions because of the price tag. The solution, usually more rigorous training and oversight, can be expensive, but when compared with how much collisions are actually costing your company, are well worth the money.

The reality is that seeking out effective solutions in order to reduce collisions can be one of the most financially beneficial decisions you can make.


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