Cost of Large Truck Accidents

United States Department of Transportation estimates that over 500,000 truck accidents occur every year. More than 75% of truck driving accidents are due to the driver of the passenger vehicle. Only 16% of all truck driving accidents are due to the truck driver’s fault. Nearly 5,000 people are killed in accidents that involve large commercial vehicles; 98% of the time, the driver of the ‘other vehicle’ is the person that perishes.

Accident Costs (direct + indirect) consist of any or all of the following:

Direct Costs:	Indirect (Hidden) Costs:
Cargo Damage	Lost Clients/Customers
Vehicle Damage	Lost Sales
Injury (s) Costs	Meetings Missed
Medical Costs	Salaries Paid to Employees in Accident
Loss of Revenue	Lost Time at Work
Administrative Costs	Supervisor’s Time
Police Report	Loss of Personal Property
Possible effect on Cost of Insurance	Replacement Vehicle Rental
Towing Costs	Damaged Equipment Downtime
Storage of Damaged Vehicle	Accelerated Depreciation of Equipment
Possible Effect on Cost of Workman’s Compensation Insurance	Accident Reporting
	Medical Costs Paid by Company
	Poor Public Relations/Publicity
	Increased Public Relations Costs
	Government Agency Costs
	Cost to Hire/Train Replacement Employees

Revenues Necessary to Pay for Accident Losses
This table shows the Dollars of Revenue required to pay for different amounts of costs for accidents.
It is necessary for a motor carrier to generate an additional $1,250,000 revenue to pay for the cost of a $25,000 accident, assuming an average profit of 2%.The amount of revenue require to pay for losses will vary with the profit margin.
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Yearly Accident Costs	Profit Margin
	1%	2%	3%	4%	5%
$1,000	100,000	50,000	33,000	25,000	20,000
5,000	500,000	250,000	167,000	125,000	100,000
10,000	1,000,000	500,000	333,000	250,000	200,000
25,000	2,500,000	1,250,000	833,000	625,000	500,000
50,000	5,000,000	2,500,000	1,667,000	1,250,000	1,000,000
100,000	10,000,000	5,000,000	3,333,000	2,500,000	2,000,000
150,000	15,000,000	7,500,000	5,000,000	3,750,000	3,000,000
$200,000	20,000,000	10,000,000	6,666,000	5,000,000	4,000,000
Revenues Required to Cover Losses