Lord Chancellor to review accident compensation discount rate

The accident compensation discount rate - worked out as the amount an individual can expect to earn from their payout and then discounted from the total - is to be re-examined by the Lord Chancellor.

This is welcomed by the Association of Personal Injury Layers, which claims the level - set at 2.5 per cent in 2001 - is too high and does not reflect recent falling yields.

President Muiris Lyons commented: “For years now, injured people have been under-compensated because of the previous government’s failure to review the discount rate in light of economic changes."

Accident compensation may rise as a result of the possible revision, with less being deducted from injury claims following incidents such as road traffic collisions or an accident at work.

Initially devised through a calculation based on yields generated by index-linked government stock, Mr Lyons claims average gross annual yields have been less than one per cent over the past three years.

Published by Rose Orlik