Insurers should not be allowed to shirk their responsibilities by pushing for more favourable discount rate, says APIL


The Government must not allow the insurance industry to shirk its responsibility to fully compensate severely injured people by trying to get Ministers to calculate a discount rate that protects their profits.

The warning has come from the Association of Personal Injury Lawyers (APIL) a day before the consultation on the discount (Ogden) rate closes.

In its response to the consultation, which is considering changing the way that compensation is calculated for people who have been catastrophically injured, APIL said that the fate of people who have been critically injured through no fault of their own should not be left in the hands of insurers.

Neil Sugarman, president of APIL, said: “In remaining the same for 16 years the discount rate failed to reflect seismic economic changes, which means injured people have gone seriously under-compensated for far too long. This is why it was corrected earlier this year.

Frenzied insurance industry rhetoric following the correction is designed to hide the fact that insurers have enjoyed a windfall in recent years at the expense of people whose lives have been shattered.

He added that the formula for making the calculation did not require injured people to invest their compensation in high risk investments. He said that this should not change as claimants with severe injuries needed their money to look after them for the rest of their lives.

“Make no mistake: this calculation, by definition, only applies to the most severely injured people who may need round the clock care,” he said.

“Their homes will need special adaptations for wheelchairs and other equipment, and they may never be able to earn a living again.”

“This is all because they were injured through negligence. This could happen to any of us, at any time. The purpose of insurance is to cover these eventualities. The insurance industry must not be allowed to shirk its responsibilities.”


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Mark Dugdale is the editor of Claims Media. Mark welcomes articles, letters or feedback from readers and can be reached via