Costs of Auto Dealer Injuries Add Up Quickly!

The financial results of a dealer may be significantly impacted by the direct and indirect expenses of a work-related illness or injury. As you aim for a zero-loss rate, it becomes evident how well “safety pays” when you consider how quickly those auto dealer injury costs mount up.


Valid or Invalid?


In order to make up for a workers’ compensation accident that cost a dealership $824,00 in direct and indirect costs, more than $38 million in sales may be needed.


The response may very well be accurate. Before we get into an example to show this, though, let’s quickly review why the direct and indirect costs of a work-related illness or injury may mount up so quickly.


Examining a Dealer’s Extremely Unfavorable Day


Assume Dealership ABC owns an industrial truck with power, known as a forklift. However, there are no safety guidelines or training available for using this forklift. When a worker leaps onto a forklift to transport a large component to a service bay for installation and collides with a car that is backing out of the service bay due to a brake failure, an accident happens.


 The cage encircling the driver’s seat pins the forklift driver’s leg beneath it. After being freed from the forklift, he is taken to the hospital immediately, where an amputation of his leg is required. In addition, he broke a bone and had a concussion.


The engine core that was being delivered on the forklift slid off as a result of the collision, hitting two large oil drums that burst and sprayed oil all over the parking lot. The dealership currently lacks a spill-prevention plan, and the oil flows down the storm drain that feeds into a creek.


 Hopefully, it’s clearly clear to you that the absence of a spill-prevention plan, safety policy, or training will probably have a detrimental, snowball effect on the overall loss cost.


How much will Dealership ABC have to pay for this accident?


 We gathered some expenses from instances and citations that have already been published. Let’s examine this:


Using OSHA’s $afety Pays estimate, the direct medical costs for the amputation ($96,003), concussion ($54,571), and fracture ($54,856) came to $205,430 in total.


The $afety Pays calculator indicates that there were $225,972 in indirect expenses (missed work time, replacement labor costs, pain and suffering, etc..)


 A total of $332,543 in OSHA citations were issued for:


failing to verify that the driver had satisfactorily finished powerful industrial truck training (a major infraction of $15,625)


due to the driver’s $4,400 infraction for failing to use a seatbelt.


for knowingly failing to make sure the forklift brakes were functioning safely (a $156,259)


for neglecting to perform a pre-trip examination on the forklift (yet another deliberate breach of $156,259)


EPA fine of $25,847 for failing to have a strategy in place to prevent spills, plus cleanup expenses of $15,000, for a grand total of $40,874


A $350,000 settlement was reached in court after the injured worker’s attorney reminded the dealership and its insurance provider of all the OSHA citations, which together form a substantial body of evidence that could be utilized to prove the dealership’s negligence in failing to implement a forklift safety training program and in neglecting to inspect and repair the brakes.


The Effects of Auto Dealership Injury Claims on Profitability


Dealership ABC may face severe financial consequences because of the $1,154819 in losses it had to pay for this one occurrence alone. The dealership has to bring in $38.5 million to offset this loss if it operates on a 3% profit margin and charges $16 for oil changes. These car dealer injury claims are exorbitant! That’s one of the reasons safety pays off and that aiming for zero losses is the right course of action!


Use SimpSocial to Make Safety Pay


 KPA’s special blend of software, training, and professional EHS consulting services can give your staff and your dealership the coverage you require.


More than 120 field consultants in North America are at the disposal of KPA clients, offering both virtual and on-site compliance support along with audit loss control services. Additionally, dealers may manage their F&I, HR, and EHS programs on a single, all-inclusive platform with the aid of KPA’s Vera Suite software.


KPA’s software platform and extensive industry knowledge enable clients to lower expenses, simplify operations, and minimize risk.

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