Discount rates not set in stone.

Though the Lord Chancellor's decision to set discount rates for personal injury damages at 2.5% was short of what was hoped, a review may be possible.

At first glance, the Lord Chancellor's announcement on 27 June of a
2.5% discount rate for personal injury damages did not seem the best news
for the insurance industry or policyholders. Insurers had hoped for a
higher rate of return - certainly in excess of 3% and, in an ideal world,
as high as 4%-5%.


Historically, the courts have applied a discount to the future loss of
earnings element of a personal injury award, at a rate that should prevent
the claimant from receiving a windfall from the early