Road Safety Impact Bonds - A Financial Business Case

Road infrastructure safety investments worldwide can provide very high returns on investment with benefit cost ratios in excess of 5 to 1 and internal rates of return of 30% plus common. iRAP together with road authority and development bank partners worldwide are exploring the potential of Social Impact Bonds and similar innovative investment vehicles to be applied to infrastructure road safety improvements to capture these benefits in a sustainable funding model that saves lives. The focus of the work is to measure and provide the essential connection between those who financially benefit from reductions in road trauma (e.g. emergency response, trauma units, health systems, social support systems and the insurance sector) and those with the solutions (e.g. road agencies, road safety units). Initial feasibility and pilot studies are underway and the paper provides an update on progress worldwide and in particular ongoing work in Victoria, Australia. The Victorian Government, VicRoads, TAC, RACV, ARRB Group and iRAP are currently reviewing the true third party insurance claim costs associated with crash events on the Princes Highway East in Victoria. The study is seeking to understand the true before and after fatal and serious injuries outcomes, and the change in claim costs associated with the TAC and VicRoads targeted road safety investment on this corridor. Linked to an understanding of the before and after AusRAP star ratings on the road section along with before and after ANRAM (the Austroads Australian National Risk Assessment Model) fatality and serious injury estimations the study will seek to explain the financial business case for investment in safer roads. The potential to transfer the Victorian investment model and study outcomes will be explored through other pilot studies being developed for India and ongoing developments in the UK, US, Mexico, Colombia and planned feasibility studies with the Asian Development Bank. The application of Development Impact Bonds (e.g. the UK Government initiative) as a financial model to accelerate high return road safety improvements to road networks in low and middle-income countries is also examined.

Language

  • English

Media Info

  • Media Type: Digital/other
  • Features: Figures; References; Tables;
  • Pagination: 16p
  • Monograph Title: Proceedings of the 25th World Road Congress - Seoul 2015: Roads and Mobility - Creating New Value from Transport

Subject/Index Terms

Filing Info

  • Accession Number: 01670558
  • Record Type: Publication
  • ISBN: 9782840604235
  • Report/Paper Numbers: 0500
  • Files: TRIS
  • Created Date: May 3 2018 6:52PM