Example of Costs of Accidents Illnesses

It can be defined as cost of illnesses and accidents to the costs produced within a company or institution due to accidents or illnesses that occur in employees or officials. These costs can be produced by:

• Accident
• Diseases
• Prevention

The costs for accidents, also called human costs, are those that are produced in the worker or worker when an accident or illness has already occurred.

The costs for illnesses are produced when they already exist or in a preventive way, potential illnesses of the workers are treated, as well as the payment of quotas or social security.

Prevention costs, these costs are investments made by entrepreneurs and administrators in order to avoid accidents, such as changes in electrical and gas installations, adjustments to machines, or purchase of articles of security etc.

It is essential that these costs are always below profits, and the company must acquire the corresponding preventive processes to avoid higher expenses.

These costs are always paid by two parties:

• The employer (economic cost)
• The employee (physical cost)

Example of accident and illness costs:

Cost of prevention

This cost is carried out by the companies in order to avoid accidents, and can consist of an infinity of actions, which can be from the purchase of equipment, training of workers as well as the purchase of machinery or repair of facilities or machinery.

Human cost

It is the cost produced in the employee, having caused an accident, and its subsequent repair or pension, and corresponding expenses. These expenses can be focused on the worker, his rehabilitation or his family in the corresponding case.

Economic cost

It is the valuation of the economic cost within the company, in which the decision is made to run with the expenses directly or use the services of an insurance that would bear the corresponding expenses.

This insurance would become a passive investment, which would take effect at the time that said inconvenient, producing in the end a much lower expense than that of the company if the company runs with Expenses.

Suppose that a company, dedicated to the manufacture of footwear, has a plant of 200 employees, and therefore security decides to change the tanning facilities, due to the handling of hazardous material (sulfuric acid and chrome).

Delivery of the necessary equipment to avoid burns and material spills.

Subsequently, he performs the training of the stroke cutting personnel, who must take the corresponding precaution, due to the use of pneumatic cutters.

Training of last ironers, who work with steam appliances at very high temperatures.

Administration logistics

Administrators and executives must check that the costs and expenses produced in these improvements are not higher than the profits produced by the final product, otherwise it would be contrary to the mission of the business.

They must make the decision to hire a medical security company that should take care of both medical expenses.