A lump sum compensation award is not simply a weekly loss figure multiplied by the number of years remaining. Life expectancy determines the period over which future losses are projected, and small differences in that period can produce large differences in the final award.

Two sets of life expectancy data are commonly used in NSW personal injury matters: the ABS life tables and the Cumpston Sarjeant medium life expectancy figures. The difference between them can meaningfully affect the size of a lump sum award.

The discount rate used in a personal injury compensation assessment directly affects how large the lump sum award will be. Understanding what 3% and 5% actually mean — and why the choice matters — is essential for anyone involved in a serious injury claim.