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Article: Actuarial assessment of damages in personal injury litigation: How precise are we?
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TitleActuarial assessment of damages in personal injury litigation: How precise are we?
 
AuthorsChan, FWH1
Chan, WS
Li, JSH2
 
KeywordsInterest rate risk
Longevity risk
Multipliers
Ogden tables
Stochastic modelling
 
Issue Date2012
 
PublisherOxford University Press. The Journal's web site is located at http://lpr.oxfordjournals.org/
 
CitationLaw, Probability And Risk, 2012, v. 11 n. 1, p. 25-39 [How to Cite?]
DOI: http://dx.doi.org/10.1093/lpr/mgr021
 
AbstractIn personal injury litigation, claimants may seek their compensation for future losses or expenses as a lump sum that is determined by the product of a multiplicand and a multiplier. The multiplicand represents the annual loss in earnings and other benefits, as assessed at the trial date, while the multiplier discounts future pecuniary values into a single present-day lump sum amount. At present, multipliers in the UK are calculated using actuarial methods and based on assumed mortality and interest rates. However, it is entirely possible that these assumptions are incorrect, and if they are, then all claimants who rely on the same set of actuarial multipliers will be affected. In this article, we investigate how the uncertainty surrounding mortality and interest rate assumptions affects the precision of actuarial multipliers. With the aid of stochastic models, we estimate the possible range of values that an actuarial multiplier can take. © The Author 2011. Published by Oxford University Press. All rights reserved.
 
ISSN1470-8396
 
DOIhttp://dx.doi.org/10.1093/lpr/mgr021
 
ReferencesReferences in Scopus
 
DC FieldValue
dc.contributor.authorChan, FWH
 
dc.contributor.authorChan, WS
 
dc.contributor.authorLi, JSH
 
dc.date.accessioned2012-04-24T07:53:49Z
 
dc.date.available2012-04-24T07:53:49Z
 
dc.date.issued2012
 
dc.description.abstractIn personal injury litigation, claimants may seek their compensation for future losses or expenses as a lump sum that is determined by the product of a multiplicand and a multiplier. The multiplicand represents the annual loss in earnings and other benefits, as assessed at the trial date, while the multiplier discounts future pecuniary values into a single present-day lump sum amount. At present, multipliers in the UK are calculated using actuarial methods and based on assumed mortality and interest rates. However, it is entirely possible that these assumptions are incorrect, and if they are, then all claimants who rely on the same set of actuarial multipliers will be affected. In this article, we investigate how the uncertainty surrounding mortality and interest rate assumptions affects the precision of actuarial multipliers. With the aid of stochastic models, we estimate the possible range of values that an actuarial multiplier can take. © The Author 2011. Published by Oxford University Press. All rights reserved.
 
dc.description.natureLink_to_subscribed_fulltext
 
dc.identifier.citationLaw, Probability And Risk, 2012, v. 11 n. 1, p. 25-39 [How to Cite?]
DOI: http://dx.doi.org/10.1093/lpr/mgr021
 
dc.identifier.doihttp://dx.doi.org/10.1093/lpr/mgr021
 
dc.identifier.epage39
 
dc.identifier.hkuros199136
 
dc.identifier.issn1470-8396
 
dc.identifier.issue1
 
dc.identifier.scopuseid_2-s2.0-84863339917
 
dc.identifier.spage25
 
dc.identifier.urihttp://hdl.handle.net/10722/146431
 
dc.identifier.volume11
 
dc.languageeng
 
dc.publisherOxford University Press. The Journal's web site is located at http://lpr.oxfordjournals.org/
 
dc.publisher.placeUnited Kingdom
 
dc.relation.ispartofLaw, Probability and Risk
 
dc.relation.referencesReferences in Scopus
 
dc.rightsPre-print: Journal Title] ©: [year] [owner as specified on the article] Published by Oxford University Press [on behalf of xxxxxx]. All rights reserved. Pre-print (Once an article is published, preprint notice should be amended to): This is an electronic version of an article published in [include the complete citation information for the final version of the Article as published in the print edition of the Journal.] Post-print: This is a pre-copy-editing, author-produced PDF of an article accepted for publication in [insert journal title] following peer review. The definitive publisher-authenticated version [insert complete citation information here] is available online at: xxxxxxx [insert URL that the author will receive upon publication here].
 
dc.subjectInterest rate risk
 
dc.subjectLongevity risk
 
dc.subjectMultipliers
 
dc.subjectOgden tables
 
dc.subjectStochastic modelling
 
dc.titleActuarial assessment of damages in personal injury litigation: How precise are we?
 
dc.typeArticle
 
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<contributor.author>Li, JSH</contributor.author>
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<description.abstract>In personal injury litigation, claimants may seek their compensation for future losses or expenses as a lump sum that is determined by the product of a multiplicand and a multiplier. The multiplicand represents the annual loss in earnings and other benefits, as assessed at the trial date, while the multiplier discounts future pecuniary values into a single present-day lump sum amount. At present, multipliers in the UK are calculated using actuarial methods and based on assumed mortality and interest rates. However, it is entirely possible that these assumptions are incorrect, and if they are, then all claimants who rely on the same set of actuarial multipliers will be affected. In this article, we investigate how the uncertainty surrounding mortality and interest rate assumptions affects the precision of actuarial multipliers. With the aid of stochastic models, we estimate the possible range of values that an actuarial multiplier can take. &#169; The Author 2011. Published by Oxford University Press. All rights reserved.</description.abstract>
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Journal Title] &#169;: [year] [owner as specified on the article] Published by Oxford University Press [on behalf of xxxxxx]. All rights reserved.

Pre-print (Once an article is published, preprint notice should be amended to):
This is an electronic version of an article published in [include the complete citation information for the final version of the Article as published in the print edition of the Journal.]

Post-print:
This is a pre-copy-editing, author-produced PDF of an article accepted for publication in [insert journal title] following peer review. The definitive publisher-authenticated version [insert complete citation information here] is available online at: xxxxxxx [insert URL that the author will receive upon publication here].</rights>
<subject>Interest rate risk</subject>
<subject>Longevity risk</subject>
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Author Affiliations
  1. The University of Hong Kong
  2. University of Waterloo
  3. Chinese University of Hong Kong