Economic Costs of Motor Vehicle Crashes

Economic Costs of Motor Vehicle Crashes

Motor vehicle crashes in the United States cost an estimated $231 billion1 in 2000, about $820 per person or 2 percent of the Gross Domestic Product2 [1]. The largest components of the total cost (26 percent each) are market productivity—the cost of foregone paid labor due to death and disability—and property damage (figure 9-11). Household productivity—the cost of foregone household (unpaid) labor—accounted for 9 percent of the total cost. Workplace cost (2 percent) is the disruption due to the loss or absence of an employee such that it requires training a new employee, overtime to accomplish the work of the injured employee, and administrative costs to process personnel changes.

Alcohol-involved crashes cost $50.9 billion or 22 percent of the total costs. Costs related to speeding were estimated to be $40.4 billion, 18 percent of the total. The failure of drivers and passengers to wear safety belts cost an estimated $26 billion, but the use of safety belts saved $50 billion [1].

Ultimately, all people pay for the cost of motor vehicle crashes through insurance premiums, taxes, out-of-pocket expenses, and the like. About one-quarter of the cost of crashes is paid directly by those involved, while society in general pays the rest (figure 9-12). Insurance companies, funded by all insured drivers whether they are involved in a crash or not, paid about half the cost in 2000, while government paid 9 percent.


1. U.S. Department of Transportation, National Highway Traffic Safety Administration, The Economic Impact of Motor Vehicle Crashes 2000 (Washington, DC: 2002), also available at, as of December 2002.

1 The costs detailed here are the economic costs not the intangible consequences of these events to individuals and families, such as pain and suffering and loss of life.

2 All dollar amounts are in current 2000 dollars.