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UK to change discount rate for personal injury claims to -0.25%

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UK to change discount rate for personal injury claims to -0.25%
FILE PHOTO: A man enters The Ministry of Justice in London June 19, 2007. REUTERS/James Boardman   -   Copyright  James Boardman(Reuters)
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LONDON (Reuters) – Britain’s Ministry of Justice said it plans to change the discount rate applied to personal injury lump sum compensation payments to minus 0.25% from minus 0.75%, it said on Monday.

The decision follows a review started by the Lord Chancellor earlier this year and follows lobbying from auto insurers, whose profits were hit by the decision to cut the so-called ‘Ogden Rate’ from 2.5% in 2017.

A lower rate requires insurers to make larger lump sum payments on personal injury claims, as it assumes lower annual investment returns for that amount.

(Reporting by Simon Jessop; Editing by Rachel Armstrong)

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