Lord Chancellor confirms outcome of review

The Lord Chancellor will today confirm that the Discount Rate in England and Wales will be set at -0.25% following the completion of the review process set out within the Civil Liability Act.

The new rate will take effect on 5 August 2019.

The next review will need to be concluded within a five-year review per the methodology set out within the Civil Liability Act.

-0.25% is a poor result. Yes, it's better than the existing -0.75%, but it remains woefully inadequate. From the industry's perspective, it tips the odds too much in favour of claimants at the expense of insurance-buying motorists and businesses, who will inevitably have to dig deeper for insurance costs.

A statement from the Lord Chancellor confirmed that the Government Actuary had provided analysis on a potential dual rate – similar to that recently established in Jersey - but concluded that a single rate remains the most satisfactory method.

A full statement of reasons and an impact assessment regarding the decision are due to be published.

A further update setting out the implications of this decision will follow.

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