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Insurance firms delay injury payments...and the reason is a disgrace

Matt Clark
Feb 11, 2018

Insurers are holding back payouts to people seriously hurt in accidents because they hope rule changes will let them pay less, it is claimed.

Controversial changes to the Ogden discount rate – the figure used to calculate personal injury awards – were due in September and would have lowered payouts...helping insurers, not victims.

But a critical report by MPs on the Justice Select Committee has held up the change.

And personal injury lawyers claim insurers are either delaying cases in the hope that reforms will arrive after all – or offering lower settlements anyway, the Financial Times reports.

Brett Dixon, Association of Personal Injury Lawyers president, said: "You’ve seen behaviour that is an attempt to avoid having settlement meetings.


"Defendants (insurance companies) don’t want to have the discussion if they think the discount rate could change to something more favourable."

In one recent case involving a work injury, the insurer’s lawyers wrote in a case document: "By the time this matter is tried, there is a real possibility that the Discount Rate will have been altered.”

The lawyers then proposed a rate that would result in a much lower payout than under the existing system.

Mark Tempest, of Fletchers, said a settlement meeting he was was supposed to have had April was cancelled, and is still to be rescheduled.

"Inevitably, it holds the client out of the money they need," Mr Tempest said. "Clients would prefer to settle sooner rather than later.

"They have the trauma of what has happened, and then the nightmare of not knowing what the future holds."

The Ogden rate – used to assess how much interest  a lump sum awarded help victims would earn to help them for the rest of their lives – is currently at -0.75%. Insurers say that is too low and overcompensates victims, leading to higher insurance premiums for all of us.

The Government planned a higher rate which would mean lower payouts. But the Justice Select Committee said in November more research should be done on how victims invested their money. That has caused even more delay.

Its response to the committee’s report is expected in the coming weeks.

At A Spokesman Said, we regularly hear from people whose lives have been affected by unexpected and catastrophic events.

That's tough enough to handle.

But when greedy insurance companies – already earning billions from record premiums – hold out for their own gain it’s a disgrace.

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