Association of Personal Injury Lawyers
A not-for-profit organisation representing injured people

PI discount rate review imminent as insurers' bid to stall fails

20 Jan 2017
APIL news

Injury lawyers have welcomed a judge’s rejection of a callous attempt by the insurance industry to continue to avoid paying full compensation to seriously injured people.  

“For far too long, people with life-long and life-altering injuries have faced running out of compensation, or had to risk their compensation on uncertain investments to try to make up the shortfall because insurers do not have to pay the full amount needed,” said Neil Sugarman, president of the Association of Personal Injury Lawyers (APIL).

A discount is applied to compensation payments to offset the accumulation of interest (net of income tax and inflation) from the investment of the compensation, such as in a bank or building society. The rate has not been reviewed or altered since 2001 when interest rates were much higher than in recent years. Under the current rate, too much is deducted from compensation payments meaning severely injured people have lost millions of pounds.

“Insurers have been getting away with undercompensating vulnerable injured people for years,” said Mr Sugarman.

Today the Administrative Court has refused an application by the Association of British Insurers (ABI) for an injunction against the Lord Chancellor’s review of the discount rate for personal injury, which is due by 31 January. Permission for a judicial review has also been denied.

But an element of uncertainty remains for claimants as the ABI is to seek leave to appeal. The Lord Chancellor is still scheduled to make her statement on the discount rate on 31 January, unless the Court of Appeal grants the ABI permission for its judicial review and grants a stay on the Lord Chancellor’s announcement.

“This desperate attempt to stall the review shows that the insurance industry would rather see seriously injured people face hardship than honour its responsibility to pay full and fair compensation,” said Mr Sugarman.

“The Administrative Court’s decision today, to allow the Lord Chancellor to continue with her already long-overdue discount rate review, is the correct one,” he went on.

“We hope that the Lord Chancellor makes the correct decision and reduces the discount rate substantially. In fact this is the only acceptable option. An increase in the rate is unthinkable.”

APIL took the unusual step of launching legal action against the Lord Chancellor late last year after successive Governments failed to review the discount rate to reflect changes in the economy.

Calculations by APIL put the correct rate at between -0.5 per cent and -1.0 per cent, based on gilt markets on 31 October 2016.


Notes to editors:

  • APIL (Association of Personal Injury Lawyers) is a not-for-profit organisation whose members are dedicated to campaigning for improvements in the law to help people who are injured or become ill through no fault of their own.
  • For more information contact APIL's press and communications officers Jane Hartwell on t: 0115 943 5416, m: 07808 768623, e:, or Lizzy Freeman t: 0115 943 5431, e:  
  • Visit the association's website at
  • • Follow @APIL on Twitter:

Past press releases

Lawyers call for law to change in child sex abuse cases, 26 Nov 2019
MoD plans treat veterans as a burden, 10 Oct 2019
Court fee hike risks pricing people out of justice, lawyers warn, 05 Sep 2019
Cut crashes in London by sharing safe driving tips, 21 Aug 2019
MPs and peers take up the call for bereavement damages reform, 16 Jul 2019
Further unfairness for injured people under extended fixed costs, 06 Jun 2019
Brighton solicitor defends justice in leading role, 22 May 2019
Injured people must not be forced to pay up front for medical reports, 20 May 2019

More past press releases

Head of Public Affairs
Lorraine Gwinnutt
0115 943 5400

Communications Manager
Jane Hartwell
0115 943 5416

Press & Communications Officer
Lizzy Freeman
0115 943 5431