After a lengthy review, the Government Actuary in Northern Ireland has determined that the personal injury discount rate will be -1.5%. The change came into effect 22 March 2022.
The discount rate is the percentage applied to a lump sum awarded to a seriously injured claimant for future financial losses. The Department of Justice writes that it “it is applied to take account of the amount that would be expected to be earned from investing the lump sum.” The compensation, when adjusted, is meant to put the claimant in a position they would have been if they did not suffer the injury.
The government explains that the rate is low because of expected inflation in the short term, low expected interest rates in the long term, and anticipated return on bonds and equities remains low. The rate is reviewed periodically, with the next planned review taking place in July 2024.
Patrick O’Hare, Managing Partner at Paschal O’Hare Solicitors, said: “The entire legal sector has been waiting with bated breath for the latest discount rate changes. We at Paschal O’hare believe that this week’s announcement is good news for injury victims across Northern Ireland.”
“These changes are going to give a critical lifeline to seriously injured people. They will allow them to receive the long term support that they desperately need,” he concluded.
You can learn more about the personal injury discount rate by exploring the Government Actuary’s report.
If you or someone you know was involved in a serious accident, learn more about our services or contact our solicitors today.
