Road safety: What the car crash epidemic costs
THE cost of road insecurity is increasingly heavy. Despite the effort made over the years, the results are still far from satisfactory. This is what emerged from the online conference organized around this theme, by L’Economiste Meetings in partnership with the Moroccan road safety agency, Narsa, last Thursday.
Specifically, the first road safety strategy was launched in 2003. The goal was to stabilize the number of deaths, especially since during the 1990s, Morocco recorded an annual increase of nearly 6%. A second strategy was rolled out since 2017, recalled Benaceur Boulaajoul, director of the National Agency for Road Safety Narsa. The goal is to reduce the number of deaths by half by 2026. Currently, “we have recorded a decline of 4% compared to the base year,” noted Boulaajoul, who says that “we are still far from the target that had been set.” This, even if Morocco has managed to “maintain the same number of deaths as in 2002, while the fleet and road traffic have doubled,” he said.
Global fund
Morocco’s efforts in this area are supported by the World Bank, through its Global Road Safety Facility (GRSF). The Fund aims in particular to “support governments in the establishment of national authorities in this area, or in the deployment of regulatory and institutional adjustments,” said Marc Navelet, Senior Transport Specialist at the World Bank. Mr. Navelet said that the mechanism also provides a range of strategic data, including the number of deaths per country, and the cost in terms of GDP. The World Health Organization is also involved in this work. A report prepared in 2018 had drawn up the state of play at the global level. The report shows that “the situation is underestimated. and Morocco is no exception to this rule,” said Maryam Bigdeli, representative of this organization in Morocco. Though officially 3,700 deaths are reported at the national level, the World Bank modelling has shown that the real number of deaths is almost double. For Ms. Bigdeli, this quantification is important, as it has an impact on resource mobilization and response planning.
Compensation
In this area, insurers can play a decisive role, especially in terms of information sharing, especially since insurance companies capture the bulk of claims, as indicated by Bachir Baddou, Director General of the Moroccan Federation of Insurance and Reinsurance Companies. For him, “the cost of road insecurity for insurers is the amount of compensation paid annually to victims and recipients of benefits.” In 2019, such compensation was 11 billion MAD, including 35% for property damage, and the rest, nearly 7.5 billion MAD, for human damages. The Director General of the Federation recalled that “even when the vehicle is not insured, or when the driver runs away at the time of the accident, the guarantee fund compensates the victims.” These compensations are calculated on the basis of a schedule of rates defined by the law. This may not seem very generous, “but it is what keeps the price of insurance at a reasonable level,” he noted. Mr. Baddou also highlighted some practices, which increase risk, particularly in relation to the condition of vehicles. “Some are repaired and put back on the road when they should be scrapped”, he regretted.
1.7% of GDP
FOR his part, Mr. Boulaajoul emphasized the complex nature of studies relating to the costs of road insecurity. In addition to the direct cost, particularly in terms of medical expenses, care, and other expenses, other costs must also be taken into account, particularly in terms of loss of production for the community. In 2009, the socio-economic cost of traffic accidents was estimated at 15 billion MAD, i.e.2.1% of GDP, said the CEO of Narsa. Currently, new estimates from the World Bank have defined the cost of each death or disability. Specifically, each death costs 3 million MAD, and each person injured nearly 800,000 MAD. In total, the new cost is 19.5 billion MAD, i.e.1.7% of GDP. For Mr. Navelet, this cost is important for the elaboration of the sales pitch to decision makers, in order to mobilize investments in road safety. This is particularly important because the goal is to involve activating cross-cutting levers, which may include, for example, the introduction of alternative forms of mobility, such as public transport, which do not prioritize individual vehicles, thereby reducing the risks. This is all the more important as «these investments cover several areas other than road equipment», insisted Ms. Bigdeli.
Mohamed Ali M’Rabi
