Evaluation of the justifiable investment in residential sprinkler system installations using the J-value methodology

Abstract

It is common for agencies around the world to conduct some form of cost-benefit analysis (CBA) when proposing an investment in a safety measure. Since resources are limited, expenditure on one particular safety measure effectively means that there are not the resources available for other measures. Due to finite financial resources, an investment in a safety scheme will require a trade-off elsewhere. As such, the objective of a CBA is to assess whether the proposed measure provides a net benefit to society or whether resources would be better directed elsewhere.Fire safety measures, such as sprinkler systems, are one means to mitigate the risk posed by fire in buildings. Sprinkler systems have a long record of property and life protection but there is a cost associated with their installation and ongoing maintenance. For many years various agencies have examined whether sprinkler systems should be mandated in some or all buildings within their jurisdiction, and as a result have conducted different forms of CBA. However, there are a number of challenges when carrying out such assessments particularly when it comes to placing an economic value on human life.This paper revisits three previous CBA available in the literature for the installation of residential (domestic) sprinkler systems in single family dwellings. The paper applies recent work to extend the J-value methodology which employs the life quality index (LQI) concept as a mean of valuing the benefit of increasing life expectancy through the mitigation or reduction in the occurrence rate of a hazard. Similar to the previous studies investigated, the paper finds that the unilateral installation of sprinkler systems in single family homes does not provide a net benefit to society. This conclusion is reached through the adoption of a novel and objective judgement scalar that is easy to implement and interpret.