Simple Calculations to Reduce Litigation Costs in Personal Injury Cases: Additional Empirical Support for the Offset Rule

This article demonstrates that if the nominal rate of interest equals the growth rate of nominal earnings, then a strong case can be made for calculating lump-sum damage awards by using the offset rule, i.e., by simply multiplying the annual loss by the number of years the loss is expected to continue. An examination of the Canadian data not only supports the offset rule, but also suggests that plaintiffs are being systematically undercompensated by rules currently in use