Car accident victims rights explained: How CTP affects payouts

23 May 2021

Gerard Malouf

Recently injured in a motor vehicle accident? You’re not alone. Every year, thousands of Australians are badly injured and even killed as a result of accidents.

If you’ve been the victim of a car accident, it’s important to know that you have certain rights — including potential compensation — no matter the severity of your injuries. Gerard Malouf & Partners are specialist car accident lawyers who can review the specifics of your case and ensure that your insurance company is paying what it’s supposed to.

What am I entitled to as a victim of a motor vehicle accident?

Being involved in a motor vehicle accident is always traumatic, whether you’re badly injured or dealing with the psychological impact. As a victim of a crash, you are entitled to a reasonable level of compensation that goes toward medical treatment (including psychological treatment, if necessary), lost wages and superannuation.

It’s important to understand that you have rights as a victim of a motor vehicle accident even if you weren’t driving, or even in a car. Passengers, pedestrians and cyclists can also make personal injury claims for damages.

What is Compulsory Third Party insurance?

Compulsory Third Party (CTP) insurance is the insurance plan required for all drivers in Australia. This insurance is typically purchased when registering a car and may even be included as a part of your registration cost. CTP insurance is important for car accident victims because it’s meant to cover any personal injury payouts that result from an incident.

Typically, the insurance of the driver found to be “at fault” for a crash will have to pay these damages. However, the system has been reformed in some states to make more room for “no-fault” situations and allow injured, at-fault drivers to also be compensated.

While the “at fault” approach to insurance may seem reasonable, it can sometimes leave drivers hampered with unnecessary and excessive bills. Proving fault, in any case, can be difficult, especially in complex cases where both parties may have contributed to the accident. In some accidents, factors beyond human error — like a collision with an animal, mechanical issues or unsafe roads — may also contribute. Quirks like these can give insurers an avenue to not cover certain damages.

Another problem with the CTP system is the high number of uninsured Australians. While Compulsory Third Party insurance is just that — compulsory — an astounding number of Australians still hit the roads each day without it. According to Finder, as many as 1 in 5 cars in Australia weren’t properly insured in 2016, or about 4 million cars total.

The penalty for driving an uninsured or unregistered car varies from state to state, but you can expect a significant fine wherever you are. In New South Wales, for example, the penalty will typically come out to nearly $700, but it can be as much as $1,472 and four license demerit points for vehicles weighing more than 4.5 tonnes.

How does CTP affect a potential payout?

Because of the nature of car insurance in Australia, your personal injury claims will most likely be made to the insurer of the other party in your accident — rather than against an individual. The exact kinds of damages and amounts that insurance will pay for may vary based on the regulations in each state.

New South Wales, for example, has reformed its system in recent years. In 2017, the state parliament passed the Motor Accident Injuries Bill, with many alterations going into effect in 2019. The bill greatly de-emphasizes the importance of finding an involved driver to be “at fault” and provides a certain minimum level of compensation regardless of a driver’s responsibility and the severity of the accident. Under the new system, affected drivers can claim 26 weeks of set benefits. These include:

Medical treatment
Return to work support
Lost wages supplementation

Notably, the law does place some limits on the amount of treatment that can be received and leaves other areas to the insurer’s discretion. As in the past, victims who are dealing with more serious injuries, such as brain or spinal damage, can receive additional benefits if they pass the 10% threshold of whole person impairment. Finally, the law also establishes a category called “blameless accidents” that covers situations where responsibility can’t be placed on a driver (or their insurer).

While the updated system does away with some of the inefficiencies of “at fault” compensation it doesn’t change the basic nature of CTP claims. Insurers may still reject your claim or offer an inadequate level of compensation. Luckily, if this occurs, you aren’t out of options.

What to do if an insurer isn’t offering the compensation you deserve

While Compulsory Third Party insurance is designed to ensure that victims receive adequate compensation for their injuries, regardless of whether they can prove the other party was at fault, this vision doesn’t always align with reality.

One of the best steps you can take to help increase your chances of adequate compensation is to seek the advice of a skilled personal injury solicitor. Your lawyer can review the specifics of your situation and tell you if you have a case for additional compensation. From there, a solicitor can review the evidence — including incident reports, photographs from the scene of the accident and records of the treatment needed — and begin putting a case together.

In most cases, you and your legal team will enter into a mediation process with the insurance company before proceeding to court. Settlements are the most common outcome, but the amount you receive may be lower than what you could get in a trial. The early conclusion will save you money in legal bills, however, and give you the peace of mind you deserve faster.

If you or a loved one feel you’re being denied the compensation you deserve following a motor vehicle accident, talk to Gerard Malouf & Partners. Whatever the specifics of your accident, our legal experts can help. GMP is not a giant, publicly listed law company, but it’s one of the largest private, highly specialized, and focused law firms in the area of personal injury across Australia. Our solicitors have a track record of taking on some of Australia’s largest insurers and winning.

Our car accident solicitors work on a “no win, no fee” basis — so you can be sure your representatives are working their hardest to achieve the maximum payout possible. Overall, each of our lawyers is dedicated to the goal of achieving “maximum justice in the minimum time.”

Gerard Malouf

Principal

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