Over 83% of UP families hit by road mishap see dip in income: World Bank report

Almost 50% of low-income households in Uttar Pradesh had to arrange for a loan, as opposed to 10.9% of the high-income households to deal with the financial fallout of the accident.

Over 83% of poor families in Uttar Pradesh reported a fall in their income and on average suffered a loss of more than seven month’s household income after a family member was injured in a road accident, according to a World Bank report.

A World Bank report on the financial impact of road mishaps on families in four states can come in handy for policymakers. (PTI)

Titled “Traffic Crash Injuries and Disabilities: The Burden on Indian Society,” the report released by Union minister for transport and highways Nitin Gadkari in Delhi on Saturday highlights the disproportionate impact of a road crash on poor households that pushes them into a vicious cycle of poverty and debt.

The study was conducted in collaboration with SaveLIFE Foundation – a national non-governmental organisation focused on road safety. It is based on the survey in four Indian states – UP, Bihar, Tamil Nadu, and Maharashtra.

"The decline in household income was more acutely felt in Uttar Pradesh. Over 83% of LIHs (low-income households) and 64% of HIHs (high-income households) reported a decline in household income after a road crash, which is higher than the overall figure of 75% and 54% for LIHs and HIHs, respectively,” Piyush Tewari, CEO and founder of SaveLIFE Foundation, said.

About 48.2% of LIHs had to arrange for a loan, as opposed to 10.9% of HIH to deal with the financial fallout of the accident. Further, a larger proportion of LIHs had to resort to selling assets and taking on extra work. A larger proportion of HIH (89.1%) spent from family savings to cope with the losses than LIH (71.9%).

As low as 7.5% of LIH victims, and 30.7% of HIH victims/family members, availed motor vehicle insurance compensation. Among those that availed compensation, just 41.9% of LIH victims and 38.7% of HIH victims received the eligible compensation.

“This shows the need for greater institutional support for road accident victims, which as we understand, UP is working to develop as part of the new road safety policy,” Tewari said.

The report revealed that the loss suffered by poor households was equivalent to less than one month’s household income for rich families on average. It further notes that a larger number of cases of property-sale, money borrowing and relocation were observed after the road accidents among LIHs in comparison to HIHs.

A larger proportion of HIHs -89.8% also reported out of pocket expenses (OOPE) compared to the LIHs-72.3%, the report said. The OOPE for LIHs was about 5.8% higher than for HIHs. Total OOPE in Uttar Pradesh was ₹79,433 for LIHs and ₹75,110 for HIHs.

As per the report, OOPE is the payment made directly by individuals at the point of service where the entire cost of health, goods, or service is not covered under any financial protection scheme.

In UP, as high as 49.1% of household members from LIHs faced difficulty in sleeping after an accident, while only 3.2% of household members from HIHs faced the same problem. A total 62.6% of LIHs and 19.4% of HIHs reported that the victim, or a household member suffered from depression after a crash.

Significantly, 50.6% of the LIHs and 50.5% of HIHs claimed that no FIR was filed for road accidents involving a family member.

In UP, a total of 514 respondents (victims and household members) participated in the survey. Among them, 101 respondents (19.6%) belonged to high-income households, and 413 (80.4%) belonged to low-income groups.

In UP, LIH on average took 73 more days than HIHs to return to their previous occupation, with LIHs taking an average of 129 days to return to their occupation and HIH taking 56 days for the same. Further, on average, it took LIHs 105 days to find a new occupation.

“The findings of the report identify the areas that require immediate improvements such as post-crash emergency care and protocols, insurance and compensation systems,” said Tewari.

The report, according to Tewari, also presents an opportunity for development agencies, policymakers and state governments for a complete policy overhaul of the existing system and to implement sustainable solution-oriented, inclusive measures to improve their performance on road safety.