The High Cost of Crashes

In addition to the terrible toll that motor vehicle collisions have on people, they also incur a huge economic cost, assuming it is even acceptable to place a dollar amount on people’s lives.

From Analysis and Estimation of the Social Cost of Motor Vehicle Collisions in Ontario by Transport Canada:

The 613,000 motor vehicle collisions occurring in Canadian jurisdictions in 2004 resulted in social costs of $63 billion. By type of collision, social costs were $39 billion (62%), $20 billion (32%), and $3 billion (5%) for fatal, injury and PDO collisions respectively.

Transport Canada estimates (page 37) these societal cost of motor vehicle crashes amount to 1.5% of GDP in Canada. By comparison, congestion costs only amount to between 0.5% to 0.7% of GDP. However, as around 20% of congestion and thus congestion cost is due to collisions, the lower estimate of less than 0.5% of GDP seems reasonable.

Making Zero Fatalities the Safety Goal
As bad as the costs of crashes are in Canada, they are even worse in the States where the costs average for crashes is around $1,500 per person per year verses under $500 for congestion. In fact, the AAA , in their report Crashes vs. Congestion – What’s the Cost to Society?, is recommending that “Achieving zero [traffic] fatalities should be the national safety goal.

Obviously with around 40,000 fatalities a year in the States, that is going to be a real challenge. However, for individual cities and towns, where fatalities number in the tens per year, this is a very realistic and worthwhile goal to strive for.

A Key Economic Advantage
The loss of a key person is devastating for organizations of all sizes. Creating a safe city and marketing that advantage could attract businesses helping to create jobs and boost the economy. Reducing crashes will also reduce health care, policing and other government costs leading to lower taxes or higher levels of government services.