Cost estimates Part 1 - The Social Cost of Road Crashes and Injuries

4. Cost estimates

The updated value of statistical life is $3.35 million per fatality, at June 2008 prices. This gives an updated average social cost per fatality of $3,374,000. For non-fatal injuries, the updated average social cost is estimated at $591,000 per reported serious injury and $62,000 per reported minor injury.

In per-crash terms, the updated average social cost is estimated at $4,309,000 per fatal crash, $717,000 per reported serious crash and $84,000 per reported minor crash. These estimates include an adjustment for the level of non-reporting.

The total social cost of motor vehicle injury crashes in 2007 is estimated at approximately $3.83 billion (up from $3.65 billion in 2006), at June 2008 prices. In addition, there are an estimated 281,500 property damage-only crashes, valued at a further $0.7 billion. Therefore, the total social cost of all motor vehicle crashes is estimated to have been $4.5 billion (up from $4.3 billion in 2006). These estimates include both reported and non-reported cases.

The total social cost of injuries, at $3.83 billion in 2007, can be broken down by injury severity as follows:

• fatalities : $1.42 billion (up from $1.32 billion in 2006)
• serious injuries : $1.57 billion (up from $1.55 billion in 2006)
• minor injuries : $0.84 billion (up from $0.78 billion in 2006)

The social cost loss of life and/or life quality due to permanent impairments accounted for approximately 91% of the total social cost of injury crashes, with property damage accounting for around 5% and other cost components making up the remaining 4% (see Figure 4.1). 
 
Figure 4.2 shows the trend in social costs of road injuries by injury severity for the years from 1997 to 2007. This shows that the reduction during 1997-2001 has levelled out in recent years.


Table 4.0 summarises the estimated total social cost of road crashes and injuries from 1997 onwards, using year-specific crash and injury conversion factors.

Table 4.0: Total social cost of road injuries, at June 2008 prices

Year	Injuries ($b June 2008 prices)
	F	S	M
1997	$1.82	$1.75	$0.72
1998	$1.70	$1.73	$0.74
1999	$1.71	$1.76	$0.71
2000	$1.56	$1.63	$0.65
2001	$1.54	$1.46	$0.59
2002	$1.36	$1.57	$0.67
2003	$1.56	$1.44	$0.72
2004	$1.47	$1.46	$0.71
2005	$1.37	$1.49	$0.76
2006	$1.32	$1.55	$0.78
2007	$1.42	$1.57	$0.84

Note: This table includes allowances for non-reported cases. 

Table 4.0: Total social cost of road crashes, at June 2008 prices

Year	Crashes ($b June 2008 prices)
	F	S	M	PDO
1997	$1.89	$1.68	$0.72	$0.54
1998	$1.75	$1.68	$0.74	$0.57
1999	$1.75	$1.69	$0.71	$0.54
2000	$1.55	$1.58	$0.65	$0.50
2001	$1.60	$1.40	$0.59	$0.46
2002	$1.47	$1.54	$0.67	$0.54
2003	$1.63	$1.38	$0.72	$0.58
2004	$1.52	$1.43	$0.71	$0.58
2005	$1.38	$1.49	$0.76	$0.62
2006	$1.40	$1.55	$0.78	$0.64
2007	$1.52	$1.57	$0.84	$0.69

Note: This table includes allowances for non-reported cases. 
 
On average, around 60% of the total social cost of road injuries relates to crashes that occurred in rural areas. The regional distributions by area are plotted in Figures 4.3 and 4.4. 

The average social costs by cost component, area, severity and region are given in the following sections. Apart from those shown in Tables 4.1a, 4.1b and 4.2, all estimates have been adjusted for the level of non-reporting.


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