Safety Trained Supervisor in Construction (STSC) Practice Exam

During an accident investigation, which of the following is considered an indirect cost?

1. Medical expenses for the injured worker

2. Loss of productivity

3. Repair costs for damaged equipment

4. Workers’ compensation claims

The correct answer is: Loss of productivity

In the context of accident investigations, indirect costs refer to expenses that are not directly tied to immediate, tangible damages, but rather to the broader impact of the accident on the organization's productivity and profitability. Loss of productivity is considered an indirect cost because it encompasses the time lost by workers who may be injured, as well as the time lost by other employees who might need to cover for their absent colleague or who are involved in the investigation and cleanup process. These consequences can significantly affect the overall efficiency and output of a project, extending beyond the mere medical expenses incurred or the costs associated with repairs and claims. In contrast, medical expenses, repair costs, and workers’ compensation claims are direct financial obligations that arise immediately from the accident itself, making them direct costs associated with the incident at hand. Understanding these distinctions is crucial for effectively managing safety and financial implications in construction projects.