Real Cost of an Accident

By: Ashraf Sameh

CMIOSH, IRCA, QHSE Manager
Renaissance Services

 Renaissance Services is Oman based multinational company established in

1986 and listed on the Muscat Securities Market.
It employs over 11,000 of staff operating in 16 countries.
It owns and operates a modern fleet of 100+
Offshore Support Vessels providing supply and
support services to oil & gas Offshore Companies.
It works for Onshore and Offshore fabrication & construction, Ship Building,
Marine Repair and Maintenance Services.
75% of business in services to oil & gas and 25% of business in home market
of Oman
It owns and operates 6 Permanent Accommodation for Contractors (PAC)
located in the interior region of Oman servicing oil fields. It accommodates
around 8,000 of contractors staff with full services.

Real Cost of an Accident

Accident Related Factors

Personal Injury;
Delay in Performing Jobs;
Damage to Equipment;
Excessive Wear and Tear on Equipment;
Unnecessary Maintenance Costs.

Accident Cost

Direct Cost

Indirect Cost

Hidden Cost

Injury Compensation
Equipment replacement
Repairing cost

Direct Cost

Administrative cost
Production down time
Insurance cost

Inferred Cost
Indirect Cost
Performance penalty
Reduced efficiency
Reduced productivity
Hiring and training

Hidden Cost
Company Reputation
Moral and loyalty

After someone has an accident or gets ill at

work, how much time does your business waste?
Sorting treatment out.
Getting back to business as usual, from
repairing or replacing equipment to
rescheduling or redoing work.
Reporting and investigating whats happened.
Meeting with insurers or inspectors.
Recruiting new staff to replace injured or sick
staff.

 Training new staff to take on the job to the

right standards.
Convincing colleagues, customers and clients
that you are doing a great job.
Finding out how long this all takes, and doing
some simple calculations based on salaries, can
be an eye-opener, even if youre only dealing
with small scale.

Accident Cost Calculation

Initial Costs:

Time to provide first aid

Time for transportation to hospital/clinic/home
Lost productivity of all affected workers
Time to make area safe
Cost of first aid supplies and equipment used
Cost of ambulance
Other Costs

Investigation Costs:

Time to investigate the accident

Time spent to complete the report
Time to complete related paperwork for your
company (e.g. company records, payroll records,
company report forms, etc)
Time to complete related Regulatory paperwork
for Ministry (for Injury or Occupational Disease)
Follow-up meetings to discuss accident
Other Costs

Damage Cost
Replacement Cost
Productivity Cost
Total Cost
Recovery Cost

Case Study from Oman

Plant operator asked an experienced labor to clean
the Screw Conveyor of Filter Belt Press. At that time
the Conveyor was OFF. The labor cleaned the
Conveyor and switch it on. He noticed some debris
still caught inside the Conveyor. He started cleaning
the caught debris using his hand while the Conveyor
was running. The hand glove that he was wearing was
caught by the screw which pulled-in his hand and
eventually cut off two fingers (thumb and pointing
finger).

The victim was transferred to the hospital with the cut

fingers in a freezing container, but unfortunately the
surgeons efforts to fix the fingers failed.

THE BILL
Wages for injured worker: OMR 2100 (covered by insurance)
Loss of production/remedial work: OMR 1750
Overtime to cover lost production: OMR 600
Wages for replacement worker: OMR 1500
Loss of time for manager and managing director
involved in the investigation OMR 750
Legal expenses, fines and court costs OMR 1350
Rise in Liability Insurance Premiums OMR 1150

Revenue Required =
Total Cost / Profit Margin %

ashrafsameh@tiscooman.com