How Proposed Changes to CTP Will Affect You
RMB Compensation division considers the impact on injured people of proposed changes to the NSW Compulsory Third Party (CTP) Scheme.
The CTP scheme is mandatory insurance cover for all motor vehicles, covering people who are injured and NOT at fault in the accident. Claims able to be made include for loss of income, medical expenses, compensation for pain and suffering and compensation for domestic assistance where someone requires that help.
Over the years the cost of the scheme has increased and insurance companies continually increase the price of the compulsory CTP Green Slip premium. To reduce the cost of these policies, the NSW Government has commenced legislative reform of the scheme to dramatically reduce benefits payable to injured accident victims.
So what rights could you lose so the greater public can save an estimated $80 a year in insurance premiums?
"Whole Person Impairment" or WPI plays a key role in the reforms. A WPI assesses the total disability of a person based on a calculation of the injured body part as compared to the whole person as a percentage. It is an American system that downplays seriousness of injuries. For example a fractured spinal vertebrae may only attract a 5% WPI. A severely fractured knee or ankle may only attract a 4% WPI.
At present injured people can claim for medical treatment they may require for the rest of their life for injuries caused by the accident. Under the reforms those suffering 10% WPI or less would only receive medical expenses for five years.
At present injured people can claim for loss of income until retirement. Under the reforms those suffering 10% WPI or less will only be able to claim for five years.
Imagine a person, say a bricklayer aged 35 years with two children and a mortgage, who damages his shoulder in an accident. He loses his ability to work in his trade and has no other skills outside manual labour, but will not be able to claim any income loss after five years. He will probably lose his house and experience financial difficulty for life even though he didn’t cause the accident.
The question we must ask ourselves is, should accident victims be the ones to suffer in order for us to save $80 in insurance premiums a year? Or is it worth exploring other alternatives to reduce the cost of the scheme to the general public?
Have you been the victim of an accident that wasn't your fault? You can contact us. We'll be able to help you via a quick phone call, ask us a question via email or even chatting with you online as time limits apply to these claims.