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Periodical payment orders

When properly insured individuals are injured in an accident, it is right that they are compensated for any resulting reduction in their quality of life. The UK’s insurance arrangements ensure that when someone is injured, they are covered for the most severe of eventualities. The IFoA believes that the needs of injured parties should be at the centre of any compensation paid in these situations.

Use of PPOs

In the case of a lump sum award for a personal injury claim, the claimant is essentially asked to take responsibility for investment, inflation and longevity risk, ensuring they properly invest and manage this often very large sum of money, whilst also budgeting appropriately so that the money does not run out before they die. Awarding a PPO is an effective way to stop the individual from having to shoulder these risks, and instead placing them with the insurer (or the NHS in the case of clinical negligence claims).

The IFoA has been engaging with policymakers to explore a policy approach that considers a PPO as the preferred settlement option. A lump sum should only be considered when the claimant, or their advisers, can demonstrate they fully understand the risks of not accepting a PPO and that a lump sum is more appropriate for their needs.

Download IFoA's briefing to MPs for the Civil Liability Bill.

Recent Developments with the Discount Rate

In February 2017 the then Lord Chancellor announced a dramatic reduction in the discount rate for personal injury claims, from 2.5% to minus 0.75%. Subsequent to this, the Ministry of Justice (MoJ) has consulted on how future changes to the discount rate used for the calculation of lump sum should be determined. The IFoA responded to the consultation and were invited to give oral evidence to the Justice Committee on the setting of the rate, and other related issues. IFoA messaging around the discount rate included our support of the use of periodical payment orders (PPOs) as a more appropriate way to compensate to catastrophically injured.

 

Contact Details

For further information on any of our public affairs or policy work please contact us on:

policy@actuaries.org.uk

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  • Asia Conference Webinar Series

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    7 September 2020 - 25 September 2020

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    There will be a prestigious line-up of international speakers discussing the insurance and financial industry’s innovation and change in Asia.  The conference will take place throughout September via an online platform. The webinars consist of plenary speaking sessions and a series of workshop sessions including Life, GI, Data Science, Sustainability, Risk Management and Investment.

    This will be the perfect opportunity for you to discover,ask questions and be at the forefront of current and developing actuarial/financial topics and trends in Asia.

     

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    This free 90 minute webinar is designed to support the IFoA CPD Co-ordinators, and others, involved in supporting our members to achieve their CPD requirements. 

    The programme will include an overview of the new CPD Scheme; specifically sharing with you key messages to support you implement and embrace the new CPD Scheme for our members within your organisation and regional community; how to arrange a reflective practice discussion; and an interactive reflective practice discussion learning exercise.  In addition, delegates will gain information about accessing, and making the most of the IFoA event Toolkits which you can make use of to run your own in-house events and events for regional communities. 

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    16.00-17.00 GMT+8

    Consumer expectations are changing Insurance. The Royal Commission in Australia, Design Obligations in the UK, the insurtech ecosystem, and digital-first consumers demanding personalised solutions will all revolutionise how insurance looks like in the future.

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    12.00-13.00 GMT+8

    This presenter / panel workshop hybrid will be anchored by two presentations examining the socioeconomic, medical and technological factors that will have a significant impact on mortality and our pricing over the next 20 years and beyond. It will also discuss whether significant mortality improvement will continue in Asia or whether varying experience of low improvements or deterioration. 

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    12.00-13.00 GMT+8

    This presentation aims to provides an overview of the reformation of current Chinese regulatory solvency regime, how industry coping with the new normal after pandemic time and how the reformation of the regulation could help the insurance industry gets back on its feet as well as coming back to the “protection” core value for the policyholders. The presentation would include:

  • Spaces available

    16.00-17.00 (GMT+8) | 09.00-10.00 (BST)

    The basic data of China’s 2nd Critical Illness Mortality Table covers 2000+ products in Chinese market, including about 340 million insurance policies and 5.1 million claimants. Presenter will give the audience a general understanding including but not limited to the following contents:

  • Autumn Lecture 2020: Professor Elroy Dimson

    Online webinar
    14 October 2020

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    Many individuals and institutions have a long-term focus, and invest funds for the benefit of future generations. Their strategy should reflect their long horizon. University endowments are one of the oldest classes of institutional investor, and I will present the first study of the management of these endowments over the very long term.

  • GIRO Conference 2020 Webinar Series

    Available to watch globally in November.
    02-13 November 2020
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    This year's GIRO has been re-designed as a virtual conference to offer members and non-members the opportunity to get up to date content from leading experts in the general insurance field via online webinars. All sessions will be recorded and made available to purchase and re-watch post-event on the IFoA's GI Online Learning Resource area.

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    Cash-flow driven investing is a game-changer for DB pension funds navigating their end-game. Suitable for sponsors who want to reduce risks on their balance sheets. And for trustees, it shifts the focus to providing greater certainty of returns, managing funding level volatility and ensuring they have enough income to pay cash-flow requirements.

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    The talk will provide an understanding of the priorities and relationships between deficit reduction contributions, in the context of wider scheme funding, and different types of value outflow from the employer based on the working party’s recently published report.