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Economic Factors in the Process of Calculation of Annuities in Bodily Injury Compensation Claims Under Liability Insurance

Author

Listed:
  • Jędrzychowska Anna

    (Wrocław University of Economics, Wroclaw, Poland; ORCID: 0000-0002-3837-1734)

  • Kwiecień Ilona

    (Wrocław University of Economics, Wroclaw, Poland; ORCID: 0000-0003-3382-9467)

Abstract

The article constitutes a legal and economic discussion of the economic factors which may and should be taken into account while calculating the benefits compensating the loss of income of the injured and of their families in case of death. The analyzed benefits are an important element of compensation of economic loss in personal injury cases where the compensation is the duty of the perpetrator (or the entity responsible for him/her) within the system based on tort liability. In light of the ubiquitous nature of TPL insurance, the payer is usually the insurance company liable under the granted guarantee. The scope of such cover results from the contract and/or legal acts. The subject calculation was based on an actuarial annuity which also takes into account the likelihood of the claimant and his/her relatives living until the subsequent periodical payments. The applied calculation is of an illustrative nature with regard to the considerations of the relevant economic assumptions made at the time of loss calculation. The discussion carried out in the article concerns the size and value of the economic factors that can be used in this model.

Suggested Citation

  • Jędrzychowska Anna & Kwiecień Ilona, 2019. "Economic Factors in the Process of Calculation of Annuities in Bodily Injury Compensation Claims Under Liability Insurance," Financial Sciences. Nauki o Finansach, Sciendo, vol. 24(1), pages 25-38, March.
    • Handle: RePEc:vrs:finsci:v:24:y:2019:i:1:p:25-38:n:2
    DOI: 10.15611/fins.2019.1.02
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    References listed on IDEAS

    as
    1. John O. Ward, 2009. "Economic damages and tort reform: A comparative analysis of the calculation of economic damages in personal injury and death litigation in the United States and the United Kingdom," Contemporary Studies in Economic and Financial Analysis, in: Personal Injury and Wrongful Death Damages Calculations: Transatlantic Dialogue, pages 35-71, Emerald Group Publishing Limited.
    2. Zoltan Butt & Steven Haberman & Richard Verrall & Victoria Wass, 2008. "Calculating compensation for loss of future earnings: estimating and using work life expectancy," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 171(4), pages 763-805, October.
    3. Matthias Kelly, 2009. "The development of an actuarial approach to the calculation of future loss in the UK," Contemporary Studies in Economic and Financial Analysis, in: Personal Injury and Wrongful Death Damages Calculations: Transatlantic Dialogue, pages 11-34, Emerald Group Publishing Limited.
    4. Tinari Frank D & Cahill Kevin E & Grivoyannis Elias, 2006. "Did the 9/11 Victim Compensation Fund Accurately Assess Economic Losses?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 6(1), pages 1-43, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    annuity; compensation; personal damage; time value of money;
    All these keywords.

    JEL classification:

    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income

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