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Personal Injury Discount Rate Consultation


The government has launched a consultation into the Discount Rate for personal injury damages.

Last month Justice Secretary Liz Truss announced that the Discount Rate was to be adjusted from 2.5% to -0.75%, with the change coming into effect on 20th March. When the adjustment was announced, Mrs Truss pledged that there would be a review into how the rate would be set in the future.

The rate adjustment was met with fierce criticism from insurers, whilst Claimant practitioners welcomed the change.

Damages in Personal Injury Claims

The consultation begins the process of a ‘root-and-branch’ review of how damages in personal injury claims are calculated, with a six week deadline set for responses.

The consultation will look at number of issues:

  • The methodology for calculating the rate.
  • Whether the rate should be set by an independent body.
  • Whether the rate needs to be reviewed more frequently.
  • Periodical Payment Orders, and whether they are more suitable than lump sum payments.

Mrs Truss said that the review will determine whether the current framework is fair for both Claimants and Defendant parties, and that it is not to review the recent rate change, but to look at the process that has been in place for the 16 years prior.

From a Claimant perspective, the review will assess the risk elements of how damages are invested, and ultimately, whether Claimants are receiving the right amount of compensation.

Following the discount adjustment there were warnings from insurers that premiums would rise in order to cover the cost. The government also set aside an extra £6bn to cover the cost to the NHS over the next five years.

A link to the consultation can be found here –

Forensic Accounting

Our team of forensic accountants assist in calculating damages in all types of personal injury and clinical negligence claims. We assess the elements involving loss of earnings, loss of profit, loss of pension and loss of dependency for both employed and self employed Claimants.

To discuss your client’s case on a no obligation basis with our experienced forensic accountants, you can call us on 0113 387 5670, email us at or fill out an Enquiry Form and we’ll contact you directly.