Compulsory Traffic Accident Liability Insurance
Compulsory Third-Party Insurance – Government Compensation After Car Accident Injuries
Our greater Perth area is vast, and relying solely on the unpredictable public transport clearly can’t meet everyone’s daily commuting needs. Many households purchase two or more cars to manage work, childcare, and other errands. When you add it up, aside from work and home, most of our time is probably spent on the road.
After driving for a while, you’re bound to encounter at least one or two minor collisions or scrapes. Usually that’s not a big deal—after all, property is insured, and you simply file a claim. In the few (yes, a few…) incidents I’ve seen, the drivers even sat chatting while waiting for the tow truck.
But if someone is injured, it becomes much more serious. The pain of injuries, hefty medical bills, lost wages—each is deeply distressing. If legal liability comes into play, the time, effort, and expense of court proceedings can overwhelm an injured person and their family.
To avoid such hassles, the WA Government introduced a robust Compulsory Third-Party (CTP) personal injury insurance system in the 1940s, commonly known as “CTP Insurance.” Under this government-administered scheme, every legally registered vehicle carries CTP cover that activates if an accident causes injury or death, with the government handling all compensation to the injured party.
Legally, CTP Insurance is a fault-based policy.
What does that mean?
“Fault-based” means the claimant must first establish who was at fault in the accident before claiming. For example, in a typical rear-end collision, the driver who rear-ended the other is usually at fault. When both parties share blame, matters become more complex—topic for another article.
Once fault is established, the claimant gathers evidence of their injuries and losses: hospital reports, specialist and allied health practitioner (e.g. physiotherapist) reports and fees, prescription costs, wage statements showing time off work, psychological assessments, and so on. These documents form the basis for calculating the claim amount.
Legally, compensation calculations commonly include:
- Loss of earnings (including superannuation contributions);
- Loss of future earning capacity;
- Past medical expenses;
- Anticipated future medical expenses;
- Travel costs to and from medical appointments;
- Costs and time spent by family caregivers;
- Compensation for pain and suffering;
- Loss of enjoyment of life; and more.
Sometimes it’s hard to fix a number just by looking at the injury, but rest assured these claims rarely under-compensate.
In one case I handled, an elderly woman sustained a neck and back injury in a rear-end crash. Although she had no obvious scars, her rehabilitation costs and associated losses totalled AUD 250,000—and the government covered her legal fees. In more severe recent cases, seven-figure claims are not uncommon.
For legal fees, I often work on a “no win, no fee” basis to alleviate clients’ concerns.
Wondering where that insurance appears? Check your vehicle registration renewal notice—part of those fees goes toward your CTP premium.
I hope you never face the misfortune of a car accident. But if it happens, remember to seek professional advice to protect your rights and secure fair compensation.
See you next issue.
Editor’s Note:
Mr Ren is originally from Guangzhou, China and has practised for many years. He is now the Principal Lawyer at LJR Legal.
Embracing modern technology, speaking the languages of our Chinese community, and serving as your dedicated legal advisor has been Mr Ren’s mission throughout his career.
As a full-service practitioner, in addition to his deep expertise in Family Law, Mr Ren also specialises in:
- Contract Law
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- …and many more.
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Disclaimer: This column provides general legal discussion only. The text, images, and any content herein do not constitute legal advice, nor does Mr Ren intend by this column to advise its readers. If you require advice tailored to your circumstances, please arrange a confidential one-on-one consultation with Mr Ren. Neither this column, the magazine, nor Mr Ren accepts liability for any loss arising from anyone’s use of its content.