John FitzGerald: State needs to invest smarter to meet the rising cost of claims via IrishTimesBiz
Normally the State can only make payments where it has Dáil or statutory authority to do so, or is legally liable. However, even where the State is confident it has a sound defence against a claim, there cannot be 100 per cent certainty as to the outcome of a case. Hence, the State may choose to settle some cases without admission of liability.
Predicting future costs over a lifetime, and likely investment returns, is subject to huge margin of error, which could either see a claimant losing out or the State significantly overpaying. It cannot be known how long the injured party will live, so a lump sum could run out years before they die. Managing the lump sum to maximise returns, and protect future care, can be seriously stressful. Where the resources run out, the individual, in any event, will be dependent on the State for care.
These proposals were implemented in 2017 but, by 2019, they had already been rejected by the courts because the price index used to estimate future inflation was deemed inappropriate. As a result, each time the periodic payments need to be reviewed, claimants have to go back to court. Repeat court hearings every few years are seriously stressful for all involved and unnecessarily costly.
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