By Christoph Watterott, Underwriting Manager Property Switzerland / Italy
No mobility scheme which omits public transportation can be considered smart. Public trains and buses are the most efficient means of moving masses from point A to B. But public transport improvements also require 10-20 years of advance planning and substantial public expenditure.
Our governments are still groaning under an austerity regime. So, they turn to public-private partnerships (PPP) to improve mass transit. PPPs create several risks.
The government faces the challenge of integrating multiple providers into a single network. This will be much easier for large cities with mission-control centers, like the one in Rio. Sensors, cameras, GPS, radar, and telecommunications feed real-time information from every train and bus to a central municipal authority. Cities can coordinate and optimize mass transit to suit observable urban desire patterns.
However, this interdependent network of technology and mobility carries a high risk of any one short-circuit or broken sensor throwing the entire city transit system off kilter. If trains and buses run on automated cues, a system crash would not only obliterate the network overview, but could put a stop to mass transit across the city. Contingencies (backup systems, components, and operational plans) will need to be robust to prevent this.
Providing public transport affordable to the average citizen also creates a profitability challenge to business. In some cases this has even caused a business to fold. Public transport service is interrupted, and the government has to buy back the business.
Legislation will continue to evolve on these public-private partnerships. Insurers will be crucial guarantors on both sides. They need to pay meticulous attention to the wordings which define liability parameters, to ensure that capacity truly covers the scope of risk.
Projects are complex, last for years, and each stage carries a different combination of financial, professional, construction, property, liability, and environmental risk. Insurers and risk engineers need to be there from beginning to end, and work very closely with businesses to understand the new physical structure designs and materials, as well as the technology, and the interaction between them.
The risks of each element and the interactions between them need to be carefully analyzed and quantified in order to provide commensurate coverage.
Clearly mass transit can never be the sole urban mobility option. Some highly developed, crowded cities have underdeveloped mass transit systems, and finding the space to expand is a challenge in itself.
Mainly, commuters from city fringes and suburbs are likely to enjoy fewer public connections. Many cities have unsuccessfully tried to force commuters to use these remote connections, and it just doesn’t work. If mass transit doubles or triples our commute times, we won’t use it. It’s important to be practical about how frequent, reliable, accessible and comfortable remote access points are for suburban residents. Otherwise, public accounts are siphoned into futility.
What else will smart-city mobility offer?
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