MEJIA, STEPHANIE C.

BSCE-2 LEP

ROAD SAFETY AND TRAFFIC ACCICENT ANALYSIS

7.8.2 Estimation of Cost of a Single Serious Injury Accidents

An serious injury is defined as :

An injury which is sustained by a person in an accident and which:
a) Requires hospitalization for more than 48 hrs, commencing within seven days from the date the injury
was received ;or
b) Results in a fracture of any bone (except simple fractures of fingers toes or noes );or
c) Involves lacerations which cause severe haemorrhage ,nerve, muscles or tendon damage; or
d) Involves injury to any internal organ;or
e) Involves second or third degree burns, or any burns affecting more than 5 percent of the body
surface;or
f) Involves verified exposure to infectious substances or injurious radiation.

Cost Category Components

Cost Category Definition

Lost Output The loss of the value of work that an

injured person would have produced during
the time that they were absent from work.

Pain, grief and suffering An allowance for the loss of quality of life
and pain, grief and suffering incurred by
injured persons, their family and friends.

Medical Costs Cost of treating the persons injured in the

crash, including the cost of doctor’s fees,
medicines, and (if required) the time spemt
in hospital and long term care.

Property Damage Cost of repairing a vehicle and other

property damage, including the costs paid
by the person and their insurance
company.
Administration Costs
Costs incurred by the police and other
services in the process of attending crashes
and associated activities, and by insurance
companies administering insurance claims.
 Estimation procedure for valuing accidents based on gross output method

Cost Component Estimation

Lost Output Calculated as the average daily wage rate of each

person involved in the crash, multiplied by the
number of days off work, then added up for all the
people involved in the crash. For fatalities and
permanent disabilities the calculation is performed
over the rest of their expected working life and
discounted to an equivalent present value.

Pain, grief and suffering Calculated as the percentage of lost output cost.

Short-term medical cost Calculated as the average length of stay in hospital for
each seriously injured person involved un the crash,
multiplied by average daily cost of hospital care, then
added up for all the people seriouslu injured in the
crash. For minor injuries, the cost is calculated as the
average cost of a visit to a doctor for treatment times
the average number of visits.

Long term medical cost Calculated as the annual cost of care for persons
permanently and severely disabled. The calculation is
performed over the rest of their expected life span
and discounted to an equivalent present value.

Vehicle Damage Calculated as the aversge cost of vehicle repairs

(sourced from insurance company records) multiplied
by the average number of vehicles involved in the
crash.
Administration cost
Calculated as a percentage of resource costs in line
with ADB recommendations
(0.2 percent for fatal accidents, 4 percent for serious
injury accidents, 14 percent for minor injury
accidents, and 10 percent for properly-damaged-only
accidents.)

Lost Output
The two main types of data requirements for costing lost output are:
1) Amount of time, i.e. hours, days, months or years, lost by casualties.
2) Average wages of casualties.

Data required on average wages of casualties

The basic sources for income data include:
• National income statistics.
• Travel time surveys.
• Casualty surveys
National income statistics have been the traditional source for estimating the lost output calculations. Various
census and living expenditure surveys produce national average income figures, which are often given for
different occupations and for urban and rural classifications. However, these estimates will represent the
general population rather than road traffic casualties.
Travel time surveys have begun to be conducted in developing countries in recent years. They are usually
conducted at the road-side and road users, at least vehicle occupants, are asked about the length of their trip
and their average incomes. However, in addition to excluding pedestrians and occasionally non-motorised
vehicle users, travel time surveys can be very route sensitive, and vary widely according to road type and
location. Income data from travel time surveys have been used to estimate the lost output in a previous crash
costing in Bangladesh, with pedestrian income assumed to be that of the poverty line
Casualty surveys (hospital or household) can provide information on the average wage rates of casualties as
well as their carers. However, as mentioned previously, hospital casualty surveys may not be representative of
all casualties, and household casualty surveys can be difficult and labour intensive. Housewife work, although
not income earning, has previously been valued at the average female wage rate. It may be possible for
casualty surveys to provide information on carers’ income, but in the absence of such data, carers can be
assumed to earn the average female wage rate.

Lost output calculations

Step 1: Identify average amount (time) of lost output per casualty, by severity
Step 2: Identify average amount (time) of lost output per carer, by severity
Step 3: Identify average wages of casualties and carers, by severity
Step 4: Estimate the cost of lost output for for injured casualties
 From the data collected and compiled in calculating lost output, the average total number of lost
working days should be known for those seriously and slightly injured, along with their carers. It should
be noted that the seriously injured range from those who spend one night in hospital to those who are
permanently paralysed or die beyond the 30-day definition of a fatal casualty. Hence, the range in time
lost by the seriously injured can be large. From Step 3, the average wages of the serious and slightly
injured casualties (and their carers) will have been estimated. Therefore, the average lost output for
serious and slight casualties can be calculated thus:

Lost output (serious) = (no. in-patient days and days visiting medical facilities + no. days at home recovering
from injuries + no. days searching for new employment ) * (average wages of casualty)} + (no. days spent
caring for casualty by carer) * (average wages of carer).

Lost output (slight) = (no. days spent visiting medical facilities + no. days at home recovering from injuries +
no. days searching for new employment) * (average wages of casualty) + {(no. days spent caring for casualty
by carer) * (average wages of carer).

Medical Cost (short and long term)

The basic sources for estimating medical costs include:
• National hospital expenditure estimates, i.e. average cost per in-patient day.
• Insurance (or social security) payments.
• Individual hospital studies.
• Road traffic casualty surveys.

National average hospital bed expenditure, i.e. average cost per bed, has been the traditional proxy for
medical costs, and these can often be found disaggregated by main facility type, i.e. tertiary centre versus
local health care clinic.
Insurance companies are often able to provide estimates of medical costs of road traffic casualties from their
claim data. Several Southern African countries, including South Africa, have a fund which pays for the medical
treatment of all road casualties. Other countries, including Ghana, have a fund which pays for casualties of hit
and run collisions, and will contain data on medical costs incurred.
Individual hospitals may be able to provide information on costs, but these will be indicative of the specific
hospital and can vary widely. While private hospitals in developing countries can be assumed to have better
cost information, they will not be representative of the public hospitals where the vast majority of road traffic
casualties will be treated.
Casualty surveys have been undertaken in some countries and were attempted in the case studies.
It should be noted that none of the data sources are able to reflect the opportunity costs involved. Casualties
are often emergency cases, which take precedence over the patients who have scheduled operations.

Medical cost calculations

Step 1: Identify available medical cost and usage data
Step 2: Consider road traffic casualty survey
Step 3: Calculate average medical costs by casualty severity
Step 4: Document assumptions and sensitivities
 Estimated costs will depend on the statistical interpretation of the results, but large standard
deviations can be expected. For example, the standard road casualty definition of a serious injury can
cover a wide range of situations. Although the majority of serious injury casualties will recover
completely, if not quickly, a few cases will incur multiple operations, permanent disability and long-
term care requirements.

Property Damage/ Vehicle Damage

The main potential sources of data on vehicle damage costs include:
• Insurance companies/claims assessors.
• Fleet owners.
• Motor repair businesses.
• Owner surveys.

Calculation steps
Step 1: Determine the average number of each type of vehicle involved in each crash

Average number of vehicles involved in each crash (example)

Step 2: Determine the average number of vehicles damaged in each crash
Step 3: Estimate the average costs of damage per vehicle
Step 4: Calculate the average vehicle damage cost per crash severity
Step 5: Present final results and highlight assumptions
 By far the largest portion of property damage is that which stems from damage to vehicles. Other
property damage is less significant, and those who are undertaking a crash costing exercise are advised
to concentrate on collecting and analysing data on the cost of damage to vehicles only. Because of the
typically large proportion of damage only crashes, the cumulative cost of vehicle damage can
contribute to the greatest proportion of total costs of crashes in a country.

Administration Cost
The sources of data on police and insurance administration costs would be the police and insurance
companies themselves. These organisations would have to be approached to provide their own estimates as
to the amount of staff time, and hence the cost, in dealing with crashes. It would be hoped that this could be
completed by severity of crash.
Calculations would depend upon the form of data provided by the insurance companies or police service. If
the amount of staff time is provided, then this would have to be multiplied by the staff wages to pay for that
time. The output would be an estimate of the average cost per severity of crash. Alternatively, if a similar
amount to that used in previous studies is used, then a simple proportion of total costs would be added to
each severity of crash.

Average cost of Single Serious Injury Accident

Cost component Amount, pesos Percentage (%)
Lost output:
Disability/serious injury 121,605
Off work
Subtotal 10,849 37.5
132,454
Pain, grief, and suffering
66,227 18.7
Medical:
Short-term
Long-term 48,000
Subtotal 32,521
80,521 22.8
Vehicle Damage
Administrative Cost 63,000 17.8
TOTAL 11,039 3.1
353,241 99.9
($6,423)
*The same cost items are considered in estimating the average cost.
7.8.3 Estimation of cost of a Single Minor Injury Accident

Minor Injuries can be painful , but they don’t threaten your life, mobility or long term survival. Examples of
minor injuries include shallow cuts or abrasions, sprains and muscle strain, bruises and skin lesions, minor
burns covering only a small area of skin.

Average Cost of Minor Injury Accident

Cost Component Amount, pesos Percentage(%)

Lost Output

 Off work 603 0.9

1,100 1.6
Medical 56,250 81
Vehicle Damage 11,470 16.5
Administrative cost
69,423 100.0S
TOTAL

*The estimation of thr average cost of minor injury accident requires the calculation of three cost items:
medical cost, repair of vehicle cost, and administrative costs.

The increasing number of Filipinos involved in road accidents each year is a serious concern. Each accident
entails economic cost, not to mention social cost of pain, grief, and suffering of families of the victims. It also
has an adverse impact on the resources of the government. Using the Human Capital Approach that focuses
on the Gross Output of road accident victims, costs are classified into three main components, namely: Victim
Related Cost; Property Damage; and Administrative Cost. The monetary value of each of these components is
estimated in this study in accordance with four types of accident severity, namely fatal, serious and minor
injury and property damage only