Northern Ireland accident victims receive less compensation than rest of UK

By
Gary Adair

Victims of road accidents, accidents at work or medical negligence in Northern Ireland are receiving much less than the rest of the UK according to the Ministry of Justice (MoJ).

The disparity in compensation awards exists as a result of a 'discount rate' that is applied during the calculation process, which has not been reviewed in Northern Ireland to bring it into line with the rest of the UK because of the absence of a power-sharing government. The Ogden rate is applied in cases of serious injury that involve large sums of compensation. It is essentially a discount rate applied to reduce the amount that insurers have to pay to reflect the interest that successful claimants can receive if they invest the lumps sum compensation award that they receive.

The principle of accident and medical negligence compensation is that the victim should be returned to the same financial position they would have been in if they had not suffered their serious injuries. That also means they should be over compensated to a point were they are put in a better financial position. The calculations are complicated and look at loss of earnings, future loss of earnings, costs that will be incurred to adapt life to deal with the serious injury, medical treatment and therapy costs and other losses emanating from the injuries. The calculation also has to take into effect that receiving a large compensation award as a lump sum gives the victim opportunities to invest the money and receive interest on it. The Ogden rate is applied to calculate how much the total sum should be discounted to reflect the interest earning potential. The higher the rate, the more the compensation award is discounted.

In Northern Ireland the Ogden rate has been stuck at 2.5% and cannot be changed until a power-sharing government returns. By contrast, the Ogden rate in England and Wales was at -0.75% and is only just being increased to -0.25% on 5th August 2019. That increase still brings it no where near the current rate in Northern Ireland, which means that compensation awards will continue to be much lower for victims of accidents and medically negligent procedures in the province.

There are increasing calls on the Department of Justice (DoJ) to amend the Ogden rate in Northern Ireland to bring it into line with England and Wales. The DoJ has confirmed that a statutory review was commenced on 1st July and that they are also waiting to see what decision is made in respect of the Ogden rate in Scotland.

If you have suffered injury or loss as a result of an accident or medical negligence, and want to speak to a compensation claims solicitor in Northern Ireland, contact Wilson Nesbitt in Belfast by clicking here.