Insurers warn of soaring claims costs and motor premiums following ‘crazy’ decision
The Lord Chancellor has announced changes to personal injury compensation payments by lowering the discount rate from 2.5 per cent to -0.75 per cent.
In finalising compensation awards, courts apply the discount rate calculation with the percentage linked in law to returns on the lowest risk investments – typically index linked gilts.
Today’s decision by Liz Truss is the first time the rate has been changed since 2001. The new rate will come into effect on 20 March.
‘The law is absolutely clear – as Lord Chancellor, I must make sure the right rate is set to compensate claimants,’ said Truss. ‘I am clear that t...