NSW CTP Reforms effective 1 December 2017.
The NSW Government has passed the Motor Accidents Injuries Act 2017 which comes into force from 1 December 2017.
This new legislation aims to:
- provide early access to income support and treatment expenses to all injured road users,
- increase the proportion of benefits provided to the most seriously injured road users,
- reduce the cost of Green Slip premiums, and
- reduce opportunities for claims fraud and exaggeration.
What is expected to change?
Injured road users, including at-fault drivers, will receive early ongoing benefits for treatment and weekly payments to cover lost income for at least six months.
Those injured road users who are not at fault and are not suffering a “minor” injury, will be entitled to claim modified damages at common law and continue to receive weekly payments whilst waiting for their claim to resolve.
Lawyers will only be able to represent injured road users in limited circumstances.
Anyone injured in a motor accident, including at-fault drivers, will be able to access benefits by lodging a claim form with the relevant CTP insurer. If the claim is lodged with 28 days of the motor accident, benefits are payable from the date of the accident. Otherwise, a claim must be lodged within three months.
Premium reductions
Given that the new legislation is expected to reduce claims costs within the NSW CTP Scheme, Allianz will reduce premiums from 1 December 2017.
The reductions will vary and will depend on many factors including geographic location, type of vehicle, driver age and vehicle age. As usually occurs, State Insurance Regulatory Authority (SIRA) will be required to approve Allianz’s premium changes.
Allianz will provide a detailed communication outlining premium reductions in mid- October 2017.
Those customers who purchase a policy prior to 1 December 2017 may be entitled to a refund reflecting the higher premium paid.
NSW CTP Refunds
What is it for and who is eligible?
Given the costs of the CTP Scheme will reduce from 1 December 2017, insurers will be providing a partial premium refund to most customers with policies already in force as at that date.
Many customers who purchased their policies prior to the price reductions from 1 December will be entitled to a partial refund of the difference between the price they paid and the new reduced price. The refund will be payable to the
registered owner of the insured vehicle as at 1 December 2017.
Motorcycle owners will not receive a refund as the cost of CTP insurance for these customers will not reduce under the new Scheme.
How is the refund calculated?
The refund will be calculated based on a formula provided to insurers by SIRA. The size of the refund will depend on the decrease in premium applicable to each customer’s policy and the number of days remaining on the policy as at 1 December 2017.
Generally, the closer to 1 December 2017 a policy is purchased, the larger the refund will be. Refunds that are less than the administrative costs of processing them will not be paid to customers but will be remitted to SIRA.
Who will provide the refund and when?
SIRA will be distributing the refunds to most customers through a third party provider.
Refunds for larger fleet customers with more than 50 vehicles will be provided directly by Allianz.
Individual refund amounts cannot be calculated until after 1 December 2017. SIRA will contact eligible customers to advise them of their refund and how to collect it.
(Source: https://www.allianz.com.au/ October 2017)