Compensation

When someone needs to receive lump sum compensation at one point in time in return for cash flows at future points in time, it helps to have actuarial input.

In the case where a claimant, say, requires a lump sum now in return for several years of future income she has lost, an actuary takes into account factors necessary to arrive at a fair value - one that if awarded to the claimant is expected to leave her unaffected by the loss. One cannot arrive at this fair value without allowing for, inter alia:
     • The fact that the current rate of income lost would have escalated in future in line         with salary increases
     • The fact that the award, once in the claimant’s hands, will enjoy investment         returns
     • The possibility that the claimant may die in any given future year

This type of calculation is often needed by legal practitioners in the Third Party / Personal Injury field, most often relating to Motor Vehicle Accidents (MVA’s) that have resulted in Losses of Earnings by claimants injured on the road, and Losses of Support by the surviving dependants of road-users involved in fatal accidents. Certain aspects of these calculations are dictated by the Assessment of Damages Act 9 of 1969.

The same methods are applied, for example, in claims for maintenance, often against deceased estates, and other claims in respect of injuries, unfair dismissals, wrongful deaths and even wrongful births.

ARCH was appointed as a service provider to the Road Accident Fund in 2004 and receives claims directly from the Fund and from attorneys acting on the Fund’s behalf, as well as from plaintiff attorneys.

We are prepared to receive payment on settlement, provided the merits of the matter have been conceded prior to our being instructed.

See the following useful documents

1: Loss of Support
     1: Info requirements when instructing ARCH
     2: Sample report

2: Loss of Earnings
     1: Info requirements when instructing ARCH
     2: Sample report

If any of the above is unclear or if you need anything further, please contact us.