Above-forecast Ogden rate cut to hit insurers

The UK government shocked carriers today by announcing a far
steeper-than-expected cut to the discount rate shaved off lump-sum
personal injury compensation, to send shares in the sector down as
Novae and Direct Line gave profit warnings.
Justice Secretary Liz Truss cut the so-called Ogden rate from
2.5 percent to minus 0.75 percent, in a move described by the
Association of British Insurers (ABI) as "crazy".
The cut - which will impact the levels of reserves that must be
carried...