State Farm: Dangerous Intersections essay

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State Farm, the nation’s largest auto insurer, distributed an inventory of the 10 most harmful intersections in the US primarily based on crashes leading to claims by its policyholders. What began as a research to cut back danger was an ongoing research that directs a significant public relations effort: State Farm gives funds for communities to additional analysis their harmful intersections and provoke improve- ments primarily based on the analysis. This case tells you ways the State Farm Harmful Intersections initiative acquired began and the way it’s executed.



>The Situation State Farm Insurance coverage has a wealthy historical past of proactive security involvement in auto and equipment design to cut back harm and property loss. In June 2001, State Farm Insurance coverage, Inc., launched the second report in its Harmful Intersection reporting collection. State Farm modeled its program after an initiative by the Insurance coverage Company of British Columbia, Canada (ICBC), and the American Car Affiliation of Michigan (AAA) to assist place the nation’s largest auto insurer as essentially the most safety- acutely aware insurer. ICBC had patterned its program on an earlier effort in Victoria, Australia. AAA, in flip, benchmarked its program on the ICBC program. AAA invited State Farm to assist fund certainly one of its intersection research. State Farm noticed this as a possibility to develop its effort right into a nationwide marketing campaign in 1999. “The 2001 research is a component of a bigger effort centered on loss prevention and enhancing the protection of intersections round the united statesA.,” shared State Farm analysis engineer John Nepomuceno. State Farm has allotted vital sources in addition to funds to the initiative. Since its inception, each metropolis with an intersection on the general record of harmful intersections is eligible to use for a $20,000 grant to defray the price of a complete visitors engineering research of the intersection. Moreover, every metropolis named to the nationwide high 10 harmful intersection record is eligible for a grant of $100,000 per intersection to defray a number of the price of constructing enhancements. All totaled, State Farm provided $four.44 million to the protection initiative in its first 12 months.

As a result of its massive market share, State Farm is the one U.S. insurer able to mine its databases for the requisite info on accidents to give you a viable U.S. record. But it surely discovered that though it had the curiosity to take action, its information warehouse didn’t have enough info to tally accident charges for intersections. To rectify this, in 1998 State Farm included a location subject as a part of the information that its claims adjusters frequently full. This location info, in open-text format, signifies whether or not the accident happened in an intersection or as a part of an incident associated to an intersection accident, and identifies the intersection. Following the 1999 research, the fields for figuring out intersections had been additional refined.

Within the first research utilizing 1998 information (reported in June 1999) in addition to the 2001

State Farm: Harmful Intersections

Used with permission of Pamela S. Schindler ©2001.

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research, State Farm checked out accidents involving solely intersecting roads. They excluded any accident that occurred on the intersection of a street and a freeway entry or egress ramp. State Farm additionally appeared solely at accidents the place the State Farm–insured driver was at fault.

Due to the research’s deal with street security engineering, the primary research ignored accident severity and made no try and isolate demographic (age or gender of driver, driving document, and many others.) or geographic (climate situations, inhabitants of space, and many others.) elements associated to the accident. It additionally appeared solely at State Farm’s personal inside incident reviews, not at any public information involving visitors patterns or quantity or police incident reviews. Primarily based on business market share info, State Farm was in a position to estimate the entire variety of crashes at a given intersection. “There was good purpose to exclude police reviews and visitors counts,” defined Nepomuceno. “The reporting threshold for police submitting reviews on accidents differs broadly from jurisdiction to jurisdiction. Some will solely fill out reviews when private harm or legal conduct is concerned. Others will fill them out solely when a automobile is broken to the diploma that it must be towed from the scene. Nonetheless others fill out such reviews on each incident. Site visitors quantity reviews are sometimes ready occasionally and infrequently by impartial sources. Not solely could the information high quality be questionable, however the time interval during which the information was collected could not match our 1998 incident reviews in each metropolis concerned. Additionally, when visitors volumes are factored in, low quantity roads with comparatively few crashes are sometimes deprioritized. Now that we’re via with the 2001 research, we’re asking ourselves if intersection quantity ought to be factored in, and if that’s the case, how it may be included with out considerably rising our effort in information processing.”

Within the 1998 research, State Farm recognized 172 harmful intersections. The highest 10 most harmful intersections in the US had been launched publicly ( com). Public affairs employees for every state may request that as much as 10 intersections be recognized for his or her state. “This was normally decided by the sources that our native public affairs employees had been prepared to place towards this system,” shared Nepomuceno. “Every state needed to acknowledge a high 10 nationwide intersection, however they may request that no extra be launched or that as much as 10 intersections inside their state be launched.” As of August 2001, 97 cities (56.four p.c) had utilized for State Farm grants.

“Whereas some within the media claimed we had ‘hit a house run’ with this system, we rapidly discovered that there was much more at stake than we had anticipated in producing goodwill with transportation engineers,” indicated Nepomuceno. “That is, in any case, a visitors security program and we’d not obtain that aim with out having the cooperation of the visitors and transportation engineering group. First, whereas initially they lauded us for the eye our itemizing dropped at visitors considerations, we and so they quickly found that the highlight generated demand for quick options, options that they usually didn’t have budgets to implement. Additionally, from their perspective, not all accidents are the identical; places with accidents that end in accidents and dying ought to be given extra consideration. Some jurisdictions had been upset that we didn’t think about intersection quantity and we didn’t embody accident price information.1 The truth that the State Farm grants had been meant to review the intersection

State Farm: Harmful Intersections

Enterprise Analysis Strategies, 14e/Schindler


extra fully wasn’t at all times seen as an answer to their quick issues.” To incorporate accident severity, State Farm wanted a measurement system for

classifying accidents. For the 2001 research, which used 1999 and 2000 accident information, State Farm calculated a median property harm accident payout (roughly $1,700). Incidents requiring payout of greater than the median quantity had been labeled as “excessive severity”; these requiring much less, “low severity.” Moreover, State Farm selected to categorise every accident utilizing a multipoint scale. Zero was assigned to “no property harm, no private harm” incidents and the next quantity was assigned to “Excessive property harm, private harm” incidents, with numbers in between assigned to ranges of property harm and private harm (see Exhibit SF 1–1). Accident scores had been summed to create an mixture hazard index for every intersection. Every intersection was then weighted by dividing the hazard index by State Farm’s market share within the space. Of the 224 intersections recognized, the highest 10 had been launched to the nationwide media. Every of these 224 is now eligible for the $20,000 grant to review the intersection to determine particular enhancements; the highest 10 are additionally eligible for $100,000 grants for enhancements. On this second spherical, State Farm has dedicated $5.48 million to the protection program.

State Farm is planning to trace the success of the Harmful Intersection program. As soon as cities notify them of the completion of an intersection’s enhancements, State Farm will begin monitoring accidents for that intersection for a interval of 1 12 months. The primary post-improvement analysis research is predicted in 2002. Moreover, State Farm is taking steps to study from the traits of the damaging intersections. Every grant utility for an affected metropolis’s research of a harmful intersection should embody:

• Assortment and evaluation of police report information. • An engineer’s “geometric evaluation”2of the intersection. • A capability profile of the intersection. • A visitors battle research.three • A benefit-cost evaluation. • A schedule of enhancements (short-term, intermediate-term, and long-term).four

State Farm plans to make use of the brand new information to determine patterns of issues. This may increasingly result in a mannequin of desired intersection traits in opposition to which enchancment plans will be assessed, additional rising the effectiveness of the loss prevention program and making life just a little simpler for the transportation engineers with whom they need to accomplice to attain security success.

Exhibit SF 1–1 Hazard Codes No Private Harm With Private Harm

No property harm zero Y

Low property harm 1 1 + Y

Excessive property harm X X + Y

State Farm: Harmful Intersections

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1 Determine the assorted constructs and ideas concerned within the research. 2 What speculation would possibly drive the analysis of one of many cities on the highest 10

harmful intersection record? three Consider the methodology for State Farm’s analysis. four If you happen to had been State Farm, how would you tackle the considerations of transpor-

tation engineers? 5 If you happen to had been State Farm, would you utilize visitors quantity counts as a part of the

2003 research? What considerations, aside from these expressed by Nepomuceno, do you’ve?



>Notes 1 Accident price is calculated by dividing the variety of accidents in a given interval by the entire

visitors quantity over the identical interval. 2 The intersection geometry or bodily structure of the intersection can play an essential function

in influencing driver conduct at intersections. For instance, a curve on the method to an intersection could impede the sight distance to a visitors sign, stopping drivers from stopping in time. Or, a driver approaching two signalized intersections very intently spaced may even see the visitors alerts at each intersections and grow to be confused about which visitors sign to obey.

three A visitors battle research is an commentary research of visitors conflicts that don’t essentially finish in an accident however have the potential to take action. Recording and learning observations of driver conduct is predicted to assist visitors engineers perceive the identical issues that end in collisions. Some examples of conflicts are the sound of sharply utilized breaks; sudden, unsignaled lane modifications; or drivers hitting their horns.

four Brief-term enhancements would possibly embody signal modifications, modifications in lane markings, or signal- timing modifications. Most short-term enhancements will be applied in lower than two years. Intermediate-term enhancements would possibly contain lane widening, the addition of flip lanes, and many others., and be achieved inside 2–5 years. Examples of long-term enhancements embody grade separation of the intersecting roads and may take 5–10 years to implement.

This case relies on info offered by John Nepomuceno in interviews that happened on August 9, 2001, and September 13, 2001. Different sources embody: “Miami Space Intersection Tops State Farm Listing of Most Harmful in the US,” State Farm press launch, June 27, 2001 ( com/media/launch/hazard00.htm); “Analysis” (http://; and “State Farm 1999 Harmful Intersection Nationwide Standing Listing” (; and “State Farm’s Harmful Intersection Initiative,” Institute of Transportation Engineers press launch, June 27, 2001 ( case relies upon info offered by John N. Nepomuceno throughout interviews that happened from August 9, 2001, to September 13, 2001. It’s compiled from varied sources, similar to State Farm’s Harmful Intersection Listing and the Institute of Transportation Engineers’ Harmful Intersection Initiative.

State Farm: Harmful Intersection

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