Highway Safety Efforts Saving Lives, Reducing Injury Liability Claims Costs

At Tuesday’s National Conference of State Legislatures’ (NCSL) National Health Conference/Standing Committee on Health meeting in Savannah, Ga., the American Insurance Association (AIA) testified about industry highway safety efforts.

These combined efforts not only have reportedly saved lives, but have significantly reduced injury liability claims and related costs. David Snyder, AIA vice president and assistant general counsel, explained that the performance and technology of both vehicles and insurance policies have improved considerably over the last 50 years.

“A main goal of insurers is to reduce, to the maximum extent possible, the deaths, injuries and property damage that result from motor vehicle crashes every day,” explained Snyder. “Because about one-half of a typical auto insurance premium goes for costs relating to personal injuries, auto insurers’ interests – increasing safety and preventing losses – are directly in line with individual drivers, pedestrians, and other roadway users.”

According to National Highway Transportation and Safety Administration (NHTSA) and Federal Highway Administration (FHWA) data, there were 42,643 motor vehicle traffic fatalities in 2003. If the crash rate of 2003 were applied to 1993, the fatality rate would have been 50,341. Additionally, the average bodily injury liability (BIL) cost per insured car would be about 30% higher if the claim rate in 2003 was the same as in 1993, Snyder noted.

“Partly as a result of highway safety progress to date, the frequency of injury claims has been held close to 1987 levels, although the cost of each claim has increased significantly due to the increase in the cost of medical care,” stated Snyder. “There is no doubt that rigorous highway safety measures have helped to restrain insurance costs.”