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5.8.8 Worked Examples of Multiple Interim Payments - prior to 1 July 2013

The following examples demonstrate the effect of multiple interim payments on a person's entitlements based on a single accepted impairment.  The examples are based on the following set of information:

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Interim A

 

2-7-2008

36

18 points

0

0.159 x $275.86 = $43.86 per week

Interim B

 

2-7-2009

37

30 points

0

0.265 x $286.07 = $75.81 per week

Final

 

2-7-2010

38

50 points

3

0.509 x $292.08 = $148.67 per week

Example 1 – Male choosing lump sum, periodic, periodic

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Election

Interim A

2-7-2008

36

18 points

0

A = 0.159 x $275.86 = $43.86 per week

$43.86 x 1232.4 = $54,053.06 lump sum

 

Takes lump sum of $54,053.06

Interim B

2-7-2009

37

30 points

0

B = 0.265 x $286.07 = $75.81 per week

A1 (current equivalent of Interim A payment) = 0.159 x $286.07 = $45.49 per week

$75.81 (B) - $45.49 (A1) = $30.32 per week

 

Takes periodic payment of $30.32 per week

Final

2-7-2010

38

50 points

3

Final = 0.509 x $292.08 = $148.67 per week

A2 (current equivalent of Interim A payment) = 0.159 x $292.08 = $46.44

$148.67 (final) – $46.44 (A2) = $102.23 per week

 

Takes new periodic payment of $102.23 per week

 

In this example (1), the current weekly equivalent of the lump sum taken at Interim A is subtracted before the final calculation of weekly payments.

Example 2 – Male choosing periodic, lump sum, periodic

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Election

Interim A

2-7-2008

36

18 points

0

A = 0.159 x $275.86 = $43.86 per week

 

Takes periodic payment of $43.86

Interim B

2-7-2009

37

30 points

0

B = 0.265 x $286.07 = $75.81 per week

A1 = 0.159 x $286.07 = $45.49 per week

$75.81 (B) - $45.49 (A1) = $30.32 per week

$30.32 x 1218.1 = $36,932.79

 

Takes lump sum of $36,932.79 and continues periodic payment of $43.86 (indexed) per week

Final

2-7-2010

38

50 points

3

Final = 0.509 x $292.08 = $148.67 per week

($30.32 ? $286.07) x $292.08 = $30.96 (current equivalent of $30.32)

$148.67 (final) – $30.96 = $117.71 per week

 

Takes new periodic payment of $117.71 per week

 

In this example (2), the weekly equivalent of the lump sum taken at Interim B is subtracted before the final calculation of weekly payments.

Example 3 – Male choosing lump sum, periodic, lump sum

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Election

Interim A

2-7-2008

36

18 points

0

A = 0.159 x $275.86 = $43.86 per week

$43.86 x 1232.4 = $54,053.06 lump sum

 

Takes lump sum of $54,053.06

Interim B

2-7-2009

37

30 points

0

B = 0.265 x $286.07 = $75.81 per week

A1 = 0.159 x $286.07 = $45.49 per week

$75.81 (B) - $45.49 (A1) = $30.32 per week

 

Takes periodic payment of $30.32 per week

Final

2-7-2010

38

50 points

3

Final = 0.509 x $292.08 = $148.67 per week

A2 = 0.159 x $292.08 = $46.44

$148.67 (final) – $46.44 (A2) = $102.23

$102.23 x 1221.5 = $124,873.94

$124,873.94 – (52 weeks x $30.32) = $123,297.30

 

Takes lump sum of $123,297.30 ($124,873.94 minus Interim B already paid as periodic payments).  Periodic payments will cease.

 

In this example (3), the weekly equivalent of the lump sum taken at Interim A is subtracted before the final calculation of weekly payments, which is converted to a lump sum.  Also, the equivalent of the periodic payments paid for the 52 weeks between July 2009 & July 2010 is subtracted from the final lump sum calculation.

Example 4 – Male choosing periodic, periodic, lump sum

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Election

Interim A

2-7-2008

36

18 points

0

A = 0.159 x $275.86 = $43.86 per week

 

Takes periodic payment of $43.86

Interim B

2-7-2009

37

30 points

0

B = 0.265 x $286.07 = $75.81 per week

 

Takes new periodic payment of $75.81 per week

Final

2-7-2010

38

50 points

3

Final = 0.509 x $292.08 = $148.67 per week

$148.67 (final) x 1221.5 = $181,600.41

$181,600.41 – (52 weeks x $43.86 (A) + 52 weeks x $75.81 (B)) = $175,377.57

 

Takes lump sum of $175,377.57 ($181,600.41 minus total of Interim A & B already paid as periodic payments).  Periodic payments will cease

 

In this example (4), the final assessment of weekly payments is converted to a lump sum.

Example 5 – Male choosing periodic, lump sum, lump sum

 

Payment

Date

Age

Impairment

Lifestyle

Calculation (warlike/non-warlike)

Election

Interim A

 

2-7-2008

36

18 points

0

A = 0.159 x $275.86 = $43.86 per week

Takes periodic payment of $43.86

Interim B

 

 

 

2-7-2009

37

30 points

0

B = 0.265 x $286.07 = $75.81 per week

A1 = 0.159 x $286.07 = $45.49 per week

$75.81 (B) - $45.49 (A1) = $30.32 per week

$30.32 x 1218.1 = $36,932.79

Takes lump sum of $36,932.79 and continues periodic payment of $43.86 (indexed) per week

Final

 

 

 

 

 

 

2-7-2010

38

50 points

3

Final = 0.509 x $292.08 = $148.67 per week

($30.32 ? $286.07) x $292.08 = $30.96 (current equivalent of $30.32)

$148.67 – $30.96= $117.71 per week

$117.71 x 1221.5 = $143,782.76

$143,782.76 – (52 weeks x $43.86 (A) + 52 weeks x $45.49 (1)) = $139,136.56

Takes lump sum of $139,136.56 ($143,782.76 minus the total of Interim A already paid as periodic payments).  Periodic payments will cease

 

In this example (5), the current weekly equivalent of the lump sum taken at Interim B is subtracted from the final calculation of weekly payments, which is converted to a lump sum.  The final lump sum calculation also takes account of the periodic payments which were paid for 52 weeks at the 2008-2009 rate and 52 weeks at the 2009-2010 rate.

 

Ceasing periodic payments:  In examples 3, 4 and 5, the person's periodic payments effectively cease.  This is due to the final amount being converted to a lump sum.  The 'special circumstances' provision in section 78(4) would need to be used to allow the person to choose to convert to a lump sum all PI compensation payable to them that has not previously been converted to a lump sum.

 

This provides additional flexibility to the claimant, otherwise, the amount that could be converted would be limited to the difference between the interims paid and the final assessment.