Insurance
Periodic Payment Order (PPO) Liability
Setting a liability for a court-ordered lifetime periodic payment to a seriously injured claimant.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Claims Expense — PPO Liability | Expense (+) | 1,500,000.00 | - |
| PPO Liability (Discounted PV) | Liability (+) | - | 1,500,000.00 |
💡 Accountant's Note
PPOs replace lump-sum settlements with lifetime annuity payments. The liability is the present value of all future payments, discounted at the risk-free rate. PPOs create very long-tail, inflation-sensitive liabilities.
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