On 1 February 2020, the ACT Government changed the way people injured in motor vehicle accidents on ACT roads receive compensation for their injuries. In this article Amber Wang explains what this contentious law change might mean for you if you’re involved in an accident.
It should be noted, however, that at the time of writing, the ACT Government had not yet released all of the necessary regulations or guidelines that underpin the new scheme.
Defined benefits claim
Irrespective of fault, if you’re injured in a road accident with a motor vehicle, you will be able to lodge a defined benefits claim.
You generally have only 13 weeks to lodge a claim on the prescribed forms from the date of the accident. If you also have workers compensation entitlements, you will have to decide which scheme may be most beneficial for you, as your defined benefits cease when your workers compensation claim is accepted.
After you’ve lodged your defined benefits claim, the insurer should provide you with further claim information within five business days, and within 28 days they must confirm whether they accept liability for your claim. The defined benefits provide coverage for treatment and paid care, income replacement benefits, and funeral and dependency benefits.
To determine whether treatment and paid care is reasonable and necessary, the insurer may have an independent health professional assess you, and the resulting recovery plan should be finalised within 28 days from claim lodgement. The recovery plan will be reviewed every 13 weeks, and benefits can be paid for up to five years. Payments can be ceased if people fail to follow requests by the insurer; however, the insurer must provide two weeks’ notice if they are going to cease your payments.
Quality of life payments
Your injuries can be assessed by the insurer’s independent examiners for quality of life (QOL) payments in the period between six months post-accident and four years and six months post-accident. It is essential that your application is submitted prior to four years and six months post-accident.
To qualify for a QOL payment, your injury must have stabilised, and you are assessed as having a 5% permanent ‘whole person impairment’ (WPI). WPI measures the impairment of the injured body part or organ but is calculated as a percentage of your whole body. While multiple assessments may be required, attaining 5% will still be hard. QOL payments commence at $7,000 (for 5%).
You will have 26 weeks to advise the insurer whether you agree or disagree with their WPI assessment, and if you disagree you will need to arrange your own re-assessment. Significantly, if you do not respond within the required timeframe, you are deemed to have accepted the QOL offer.
If you don’t agree with some of the insurer’s decisions about your defined benefits, there is often the ability to seek internal and then external review (via the ACT Civil and Administrative Tribunal).
Motor accident claim
If you are independently assessed as having a permanent 10% WPI, and you were not at fault for the accident, you must decide between accepting the QOL payment offered, or pursing a motor accident claim. This is a high threshold, and it is estimated that 90% of people will not reach it.
In addition, there are two categories where innocently injured people will be deemed to hold a 10% WPI at four years and six months post-accident, including:
- a child still receiving treatment and care benefits at that date
- a person still receiving income replacement who meets the ‘significant occupational impact’ test.
The motor accident claim will no longer compensate you for:
- the lost superannuation contributions for the first year of lost income
- care and assistance provided by friends and family.
Further, the motor accident claim QOL payments are generally lower than under the previous CTP scheme (for example, 10% WPI is only $25,000), although a discretionary 20% uplift is possible.
Sounds pretty simple?
Under the new scheme almost everyone injured in association with a motor vehicle on the ACT roads will be entitled to some level of compensation. The question of how much compensation you actually receive remains unclear. While the above summary makes the process seem simple, there are a multitude of hurdles, sensitive time frames, and decisions to be navigated to ensure that full entitlements are received.
It remains to be seen whether changing the road accident compensation scheme will make the ACT roads a safer place for vulnerable road users, and whether there will be adequate supports in place to maximise their physical, psychological and financial recovery.
How can we help?
You can contact our Personal Injury team for advice on personal injury matter on 02 6285 8000 or by email.
*The content of this article is provided for information purposes only, and we do not accept any liability for reliance upon the information contained in this article. This information cannot be relied upon as legal advice.
