The claim is the visible fraction. This calculator adds the uninsured indirect costs and answers the question that lands in a CFO’s language: how much revenue do we have to generate just to pay for this?
Indirect costs — downtime, investigation, retraining, overtime, schedule disruption, morale, customer impact — are uninsured and come straight off the bottom line. The multiplier is yours to set from your own loss experience; smaller claims typically carry proportionally larger indirect ratios (the approach OSHA’s Safety Pays estimator popularized). Revenue to offset = total cost ÷ profit margin.
The workers’ comp claim — medical plus indemnity — is insured, budgeted, and visible. Everything around it is not: the crew standing down while the scene is secured, the investigation hours, the supervisor pulled off production, the overtime covering the empty position, the retraining, the schedule slip, the customer call explaining the schedule slip. None of that appears on a loss run, all of it comes out of operating profit, and it recurs with every incident because it’s structural, not incidental.
Divide the true cost by your margin and the result is the sales your team must generate for the incident to net to zero. At a five percent margin, a seventy-five-thousand-dollar true cost demands one and a half million dollars of revenue — sold, produced, shipped, and collected — to buy back one injury. That arithmetic is why safety belongs in operating reviews rather than compliance binders, and it’s the frame I’d bring to your next budget conversation: prevention isn’t a cost center competing with production; it’s margin defense.
The direct claim doesn’t even stop at its own total: it feeds your experience modification rate, which reprices your workers’ comp premium for the next three years and follows you into every bid that asks for your mod. The calculator above shows one incident’s cost; the rate calculators and your loss runs show the trajectory. If the trajectory is wrong, the fix is operational — and it’s the work I do.
The uninsured costs surrounding a claim: lost production time, investigation and administration, overtime and replacement labor, retraining, equipment and schedule disruption, morale and turnover effects, and customer impact. They come off the bottom line with no insurance offset.
Your own loss experience is the honest source — review two or three past incidents and total what they actually disrupted. As a planning pattern, smaller claims tend to carry proportionally larger indirect ratios than large ones, the sliding approach OSHA’s Safety Pays estimator made standard. The default here is deliberately conservative.
Because injuries are paid for out of profit, not revenue. Dividing the true cost by margin converts an injury into the sales volume required to neutralize it — the unit of account executives actually manage by, and the fastest way to make prevention spending rational.
It always is. The follow-up question — what operational changes actually shrink it — is a thirty-minute conversation with someone who has done it.
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