Why Business Insurance is Expensive

As reported by the Associated Press, the American Automobile Association commissioned a study to determine the costs of auto accidents to society. Specifically, the report was designed to compare the costs of traffic congestion to the costs of auto accidents. The report was released today.

If you have ever wondered why your commercial auto coverage is so high, consider some of the statistics presented by the AAA:

• In 2005 dollars, the cost of an auto accident fatality is $3,246,192.
• The cost of an injury is $68,170.
• On average, auto accidents cost $1,051 per person.
• While congestion is an expensive annoyance, traffic accidents cost Americans two and one-half times the cost of congestion and amounts to $164 billion annually.

The report found that improving traffic safety was a more effective approach than improving congestion. Where traffic safety was enforced and improved, the result was a reduction in congestion.