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CTP Green Slip Scheme Changes 2009 and 2010

Legislative changes to CTP Green Slip Scheme had fundamental impact

In May 2009 the NSW State Government introduced several amendments to the Motor Accidents Compensation Act 1999 and to the Motor Accidents (Lifetime Care and Support) Act 2006. Some of the amendments to the Motor Accidents Compensation Act 1999 had a fundamental impact on the operation of the existing CTP greenslip scheme in NSW.

The amendments expanded the cost base of the scheme and provided additional benefits for at fault drivers.

Basis of the Scheme

Before looking at the amendments and the consequence of those amendments, it is necessary to look at some of the principles on which the scheme was based.

The CTP greenslip scheme in NSW was made up of two separate schemes.

The Third Party Insurance Scheme, regulated by the Motor Accidents Compensation Act 1999. Under the Third Party Insurance Scheme, compensation was available where people are killed or injured as a result of an accident caused by the driver of a motor vehicle. The scheme was fault based, except for children less than 16 years of age and for people killed or injured in a blameless accident. Prior to the 2009 amendments, the Third Party Insurance Scheme specifically excluded the at fault driver and the driver in a blameless accident.

The Lifetime Care and Support Scheme, regulated by the Motor Accidents (Lifetime Care and Support) Act 2006.The Lifetime Care and Support Scheme was introduced in October 2006. The scheme provided benefits for people catastrophically injured in a motor vehicle accident, regardless of fault. The at fault driver is included in the Lifetime Care and Support Scheme.

More information on the Third Party Insurance Scheme and on the Lifetime Care and Support Scheme is available on this site.

In summary, prior to the May 2009 amendments, the at fault driver in a motor vehicle accident was not covered by the CTP greenslip scheme unless the driver was catastrophically injured (in which case the Lifetime Care and Support Scheme applied).  If the at fault driver was not catastrophically injured, the cost of treatment was met by the public hospital system or private health insurance.

Claims

People injured in a motor vehicle accident and entitled to claim under the Third Party Insurance Scheme could lodge a formal claim, or they could lodge an Accident Notification Form (ANF). The ANF was introduced to provide for faster payment of small claims.

An ANF had to be lodged within 10 days of an accident. After lodgement of an ANF an injured person could be entitled to claim up to $5,000 for treatment expenses and lost earnings incurred within 6 months of an accident.

If an injured person lodged a formal claim, it had to be lodged within 6 months of an accident. A formal claim could be lodged where the claim would exceed $5,000, and could include compensation which could not be claimed through an ANF.  A formal claim could include hospital, medical and pharmaceutical expenses, rehabilitation expenses, attendant care services, respite care services, home modification, loss of earnings (past and future) and compensation for pain and suffering and loss of quality of life.

Scheme changes

The Government signalled its intention to reform the scheme in the November 2008 State Mini Budget when it announced “The Government will further reform the Greenslip scheme to provide hospital and ambulance coverage for at-fault drivers”.

The Mini Budget Paper (page A-7) showed that, by introducing the reforms, the Government estimated cost savings of $105,000,000 between 2009 and 2012.

The intention of the Government was to transfer the cost of treating at fault drivers from the public hospital system to the CTP greenslip scheme.

There were two major reforms to the operation of the CTP greenslip scheme as a consequence of the amendments to the legislation.

  1. For accidents occurring from 1 July 2009, the bulk billing arrangements under section 54 of the Act had been expanded to include the cost of treatment for at fault drivers, so that hospital treatment, transport by ambulance and other treatments for at fault drivers was funded by the CTP greenslip scheme.
  2. For accidents occurring from 1 April 2010, the right to claim using an Accident Notification Form under Part 3.2 of the Act had been expanded to include at fault drivers. Subject to the provisions, at fault drivers would be entitled to claim up to $5,000 for treatment expenses and for lost earnings by lodging an ANF. Also from that date, no person would be entitled to claim by lodging an ANF if their injury was the result of a serious offence committed by them.

In summary, for accidents which occurred from 1 July 2009, the cost of treating at fault drivers in the public hospital system was funded by the CTP greenslip scheme, rather than being a cost on the public hospital system or on private health insurance. For accidents occurring from 1 April 2010, at fault drivers would be entitled to claim up to $5,000 through an ANF.

However, the amendments did not extend to at fault drivers the full benefits available to other people injured in a motor vehicle accident. For example, at fault drivers would not be entitled to claim for:

  • Medical, pharmaceutical and rehabilitation expenses incurred outside a public hospital and which exceeded the $5,000 ANF limit
  • Attendant care services or respite care services
  • Home modification
  • Compensation for pain and suffering and loss of quality of life
  • Past loss of earnings exceeding the $5,000 ANF limit
  • Future loss of earnings.

Effectively, the CTP greenslip scheme was no longer fault based in respect of hospital treatment, transport by ambulance and from 1 April 2010, claims through an ANF, but remained fault based in respect of other claims such as those listed above.

The precise cost of the amendments to the CTP greenslip scheme was not clear.

As stated above, in November 2008 the Government estimated the amendments would save $105,000,000 over three years between 2009 and 2012. The Motor Accident Authority estimated that an additional 4,000 at fault drivers per year would now claim up to $5,000 through an ANF (Motor Accidents Authority of NSW, Annual Report 2008-2009, page 12).

Regardless of the actual cost, the amendments increased the cost base of the NSW CTP greenslip scheme and resulted in increased premiums.

Insurers are required to lodge submissions to State Insurance Regulatory Authority (SIRA) at least once a year, setting out the greenslip prices they propose to charge. The submissions lodged in October 2009 incorporated the impact of both reforms. The reforms were reflected in greenslip prices then being paid. In response to specific enquiries made by us, the then MAA advised that “the combined impact of the bulk billing and no-fault ANF reforms is approximately $10 per Green Slip”.

Amendments to the scheme also had an impact on at fault driver cover, an additional feature then offered by three of the insurers. Policy documents setting out the terms on which at fault driver cover was offered stated that no at fault driver benefit was payable under those policies if a benefit was also paid or payable under the CTP greenslip scheme. From 1 April 2010, benefits under the at fault driver cover policies may not have been payable where an at fault driver lodged a claim through an ANF, unless the insurers revised the policy terms prior to that date.

Analysis of at fault driver cover and an explanation of the impact of the amendments on at fault driver cover are set out on this site.

How it Works - more info

State Insurance Regulatory Authority >

Government authority responsible for the NSW CTP scheme. read more

At fault driver cover >

What is at fault driver cover and which insurers offer it. read more

Interesting statistics >

Statistics about motor vehicle accidents in the past year. read more

Discounts >

Discounts and ways to reduce costs on other insurance products. read more

Pensioner concessions >

What kinds of concessions you can claim as a pensioner. read more

Mythbusters >

Quickly separate the facts from fiction about CTP green slips. read more

What is a greenslip? >

Find out exactly what is meant by a green slip in NSW. read more

Who and what is covered? >

Who and what is covered by your CTP green slip. read more

Third Party Insurance Scheme >

The third party insurance scheme in NSW explained. read more

Lifetime Care and Support Scheme >

The Lifetime Care and Support Scheme in NSW explained. read more

Motor Accident Authority >

Previous authority responsible for the NSW CTP scheme. read more

Setting prices >

How green slip prices are set and how you could reduce them. read more

MCIS Levy >

How the MCIS levy was set and what it paid for, now the Fund levy. read more

Geographical zones >

Greenslip prices set using geographical zones by postcode. read more

Youngest driver >

Your obligations and age of the youngest driver explained. read more

Claims >

What to do if you want to make a claim from your CTP insurer. read more

Complaints >

How to make a complaint about your CTP insurer or SIRA. read more