The True Economic Costs of an Auto Accident

Most people know that automotive accidents can be devastating, with victims often experiencing a range of injuries that can potentially affect them for the rest of their lives. However, the financial repercussions can also be significant. 

According to the NHTSA, motor vehicle accidents cost American society $390 billion in 2019, equaling 1.6% of that year’s GDP and an average of more than $1,000 per resident. The costs can be broken down for the average person in the following ways: 

For the Full Cost of the Accident

As Texas follows a modified comparative fault rule, people involved in an accident may be liable for their accident-related costs if they share more than 50% of the fault. Typically, negligence is established through owing a duty of care, breaching that duty of care, causing injuries, and suffering injuries due to a breach of duty. Accident-related costs can be financially crippling, so it can often be worth hiring a lawyer to establish a strong case and ensure the right people are held accountable for their actions. 

Medical Costs

Out of all accident-related costs, medical costs are typically among the highest. Studies show that the average medical costs of fatal injuries can be between $6,880 and $41,570, while one-year non-fatal injury costs per person in an emergency department can be $1,698 to $80,172. 

However, these aren’t necessarily the costs you’ll be charged as a patient. Instead, they can be the expenses a hospital incurs for your care before they add their profit margins. Many hospitals are profitable businesses known to outperform some Fortune 500 companies. As a result, you might receive hospital bills totaling tens of thousands of dollars. 

Legal Fees

Accidents where damage or injuries are reported often require legal intervention. Not everyone wants to negotiate with insurance companies on their own, and they may struggle to hold the guilty party accountable. 

Personal lawyers operate with various fee structures, but contingency is the most common for accident victims. This means that accident victims don’t have to pay for their lawyer’s time unless they achieve a successful outcome. 

Vehicle Costs

Vehicle replacement or repairs can be a common economic cost related to a car accident. Sometimes, vehicle owners are only required to pay for their own vehicles, but they might also be required to pay for the repairs or replacement of someone else’s vehicle if they were at fault. 

Having the most appropriate insurance policies might ensure vehicle costs aren’t as financially devastating as they could be. However, many people involved in accidents can still face financial repercussions like credit card delinquency and bankruptcy. 

Income Loss

Income loss can be of great concern for accident victims. When their injuries are severe, they might need to take time off to heal or stop work altogether. As many Americans live paycheck to paycheck, this can mean they need to rely on the government for help. Fortunately, law firms can fight for their client’s right to compensation for accidents, meaning there’s potential to receive damages for current and future lost earnings. 

Injuries are undoubtedly the most significant concern regarding automotive accidents. However, the economic costs can also be major. Alongside healing from their injuries, accident victims must also take care of vehicle repair expenses, income loss, medical bills, and, sometimes, legal fees.