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Car Accident Compensation – Your Guide

If you’ve been injured in a car accident, life can be a real challenge as you deal with financial stress on top of your injuries. Fortunately, car accident compensation in NSW is available to all injured drivers, passengers and pedestrians through the CTP insurance scheme. This guide covers everything you need to know about car accident claims, including how much you can get, who can claim, how to claim and how to get free legal help with your claim.

Man with a neck injury in a car accident potentially eligible for CTP compensation.

How much should I expect from my car accident injury claim?

In the 12 months to May 2021 there were 11,016 motor accident injury claims submitted in NSW and $466M was paid out in benefits and lump sums.*

The amount of car injury compensation you can claim depends on the extent of your injuries, which will be classified as ‘minor’ or ‘non-minor’. The following table outlines the difference:

Physical Injury ClassificationExamples
Minor (soft tissue injuries)
  • Muscle injury
  • Sore back
  • Whiplash
Non-minor (fractures, organ damage)
  • Broken arm
  • Head or brain injury
  • Injuries that require surgery

It’s important to remember that compensation after a car accident also depends on the extent of your losses (such as lost income). Here’s a summary of car accident compensation entitlements:

1. Minor injury
  • Income support, medical and home care expenses for up to 6 months
2. Non-minor injury
  • Income support, medical and home care expenses that can extend beyond 24 months if there is a claim for damages
  • A lump sum for past and future lost income
3. Non-minor injury over 10% WPI^
  • An additional lump sum for pain and suffering

To get an estimate of your car accident injury NSW entitlements you can use this compensation calculator. Or, for more information read our CTP Claims Guide.

*Based on SIRA Open Data, May 2021.

What is the average settlement for a minor car accident?

The average settlement for a minor car accident injury claim in NSW is likely to be significantly less than $43,174, which is the average across all NSW claims. If your injury has been classified as minor, then it’s considered to be a soft tissue injury where recovery usually takes less than six months, and you’ll only be entitled income support and medical and home care expenses for up to six months – you won’t be entitled to any lump sums. However, some car accident injuries can take time to develop, or may worsen over time, so the original injury assessment might no longer apply.

If this has happened to you, you can get your injuries reassessed. If your new assessment confirms your injuries have worsened or you’ve developed additional complications, then it’s possible you could be reclassified as having non-minor injuries. That would mean you may be entitled to additional car accident injury compensation including a lump sum.

How much do you get for pain and suffering in a car accident?

If your injuries are more serious and you weren’t at fault in the accident, you might be eligible to claim lump sum compensation for pain and suffering and for future loss of earnings. These lump sum claims can be substantial, with many running into hundreds of thousands of dollars and some more than one million dollars.

Lump sum payments for pain and suffering are based on a fixed scale that specifies how much you’ll get depending on your car accident injury. However, in most cases the actual amount you receive will be reduced depending on the extent of your injury, on a sliding “partial” scale. For example, the scheme provides a substantial payment for the loss of use of a limb, so if you’ve suffered a partial loss of use, the payment will be reduced accordingly.

For more information, read this article on car accident compensation for pain and suffering.

How much is a neck and back injury settlement?

A neck and back car accident injury settlement will depend on the severity of your injury.

Here are some examples:

You can have a confidential conversation about your injuries and car accident compensation entitlements with a specialist car accident lawyer free of charge by calling 13 15 15.

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Can I sue for emotional distress after a car accident?

Depending on your diagnosis, a car accident injury settlement for emotional distress may be available through the NSW CTP scheme. So, if you’re eligible, you won’t need to sue – you can simply claim compensation from the CTP insurer of the vehicle that was mostly at fault in the accident.

Just like physical injuries, psychological injuries from car accidents are classified as either minor or non-minor:

How long does a car accident compensation settlement take?

After you submit your car accident compensation claim the CTP insurer will assess it. Within four weeks you’ll receive a letter from the insurer stating whether it’s accepting or denying your claim and what compensation you’re entitled to. The insurer will start making compensation payments to you within 14 days if it accepts the claim. The CTP insurer will then send you a second liability decision within three months of your claim being lodged. This liability decision indicates whether your injuries have been classified as minor or non-minor and who is at fault for the accident.

How often do car accident claims go to court?

Most car accident compensation claims don’t go to court. If you’re not happy with a CTP insurer’s decision on your compensation payments you can dispute the decision, and most disputes are resolved by agreeing on a settlement out of court.

The first step is to request an “Insurer Internal Review” by the CTP insurer, then if you’re still not satisfied with the outcome you can escalate your dispute to the Personal Injury Commission (PIC). The PIC will help you in one of two ways:

If you’re planning to challenge an insurer’s decision, you should speak to a specialist car accident lawyer first. You’ll have a much better chance of success with lawyer on your side, and in many cases your lawyer’s fees will be paid by the CTP insurer.

How is a car accident compensation settlement paid out?

The amounts you may be entitled to are summarised below:

CTP ClaimCTP Compensation Payout Process
Medical and treatment expenses
  • Your GP will provide the insurer with a treatment referral
  • CTP insurer will generally approve a number of sessions with your GP and other treatment providers
  • CTP insurer will generally write directly to your provider and notify them of the approval
  • CTP insurer will pay the GP or treatment provider directly – these expenses won’t form part of your regular payments
  • Benefits are capped depending on the severity of your injuries
  • You should receive whatever treatment is necessary to make sure you recover from your injuries
Care expenses
  • Generally treated in the same way as medical and treatment expenses
Income support payments
  • Weeks 1-13: 95% of pre-accident earnings
  • Weeks 14 – 26: 80-85% of pre-accident earnings. If the CTP insurer cuts off your benefits it will need to give you four weeks’ written notice.
  • Beyond week 26 you can only receive benefits if you weren’t the driver mostly at fault and your injuries have been assessed as non-minor

In addition, if you make successful common law claims for future loss of earnings and pain and suffering, these will be paid to you as lump sums.

Car accident compensation example: While travelling to visit a friend, Layla was suddenly jolted forward and lost control of her vehicle after a runaway truck hit a travelling taxi which was then propelled straight into her. Layla sustained a deep head laceration, a broken and dislocated arm, a fractured disc in her lower back and multiple bruises and abrasions to her limbs and torso. Law Partners successfully claimed a $1M payout for Layla, which provided massive relief while she recovered and shored up her financial future. Read Layla’s full story.

How do I claim car accident injury compensation?

There are three ways to make a car accident compensation claim in NSW:

SIRA manages the claim process, and car accident injury claims are processed by the CTP insurers.

To make a car accident injury claim, you’ll need:

For more information on compensation after a car accident, here’s a step-by-step guide to lodging your car accident claim that includes links to the SIRA claim portal and the application form.

How do I get free legal help with my car accident compensation claim?

For car accident compensation in NSW, lawyers’ fees are regulated. Lawyers can’t charge to help you lodge your application for personal injury benefits. But if you’re disputing a CTP insurer’s decision, then for most disputes you can engage a lawyer at no cost to you.

There are two types of statutory disputes – paid disputes and unpaid disputes:

Law Partners is Australia’s largest specialist personal injury firm, with legal teams that specialise in car accident compensation in NSW. We’re also the team behind ctpclaimadvice.com.au– Australia’s most comprehensive website on car accident injury claims, with step-by-step guides on how to claim your maximum compensation, including any lump sums you’re entitled to.

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