This paper examines the new statutory regime for paying damages for personal injury by means of periodical payments instead of a lump sum. How are such payments to increase in future to take account of rising care costs, especially when these usually form the largest part of a major award? The answer to this question is crucial in determining the extent that the new form of payment will be used. How periodical payments are to be indexed is also a key factor in calculating the total cost of compensation and, in particular, in assessing the liabilities of the National Health Service. The issue gave rise to litigation which was voted by personal injury practitioners as the most important of the year. Here, that litigation and the statutory reforms which gave rise to it are set in their wider academic contexts.