A short while ago, I wrote an article about the misguided efforts of a couple of the CTP insurers in Queensland to introduce a “no-fault” system of insurance in Queensland and remove the complete common law rights of persons injured in motor vehicles accidents in this State.
I have recently had cause to advise a client about making a total and permanent disablement insurance claim arising from a motor vehicle accident he suffered in the Northern Territory (the Territory). The other driver was completely at fault. In advising him, I checked on the relevant legislation in the Territory with respect to motor vehicle accidents.
I was shocked and astounded at the motor vehicle legislation in the Territory. It is the Motor Accidents (Compensation) Act 1979 (the Act). At section 5(1), it states, “An action for damages does not lie (either at common law or by statute) for the death of, or injury to, a person arising from a motor accident that occurs in the Territory.”
So to start with, the common law rights (i.e. ability to claim damages) of an injured person in a motor vehicle accident in the Territory are completely removed. What replaces it is an insurance system run by, you guessed it, the Commission. But apparently, the Commission is not an independent government body but known as the Territory Insurance Office, which is really a private insurer, Allianz.
What happens if your injuries stop you from working?
If your injuries cause you to be unable to work, it does not matter how much money you were earning at the time of your injury and how many years of past or future income you have lost. The maximum you can receive in compensation for loss of income is for a period of 2 years, and the amount you are paid is based upon 85% of average weekly earnings in the Territory. Heaven help you if you are a young person in a high-paying job with a lifetime of employment ahead of you and you are severely injured in the Territory, such that you can no longer work.
If the spouse who is the financial provider for the family should be killed, leaving the other parent and one child, the maximum benefit is 10% of 3 years’ worth of average weekly earnings for the child (no matter the age of the child) and the balance of 90% of 3 years’ worth of average weekly earnings to the surviving parent.
If common law applied, the surviving parent and child would be able to claim for the loss of financial benefits and care provided by the deceased parent for the life of the surviving parent and for the child until 18 years old. A family in the Territory is left high and dry. This could be your family if you are heading to the Territory.
What happens if you’re an overseas tourist and you’re severely injured?
If you are an overseas tourist who is severely injured, and you leave Australia after receiving hospital treatment, there are no lump-sum benefits payable to you at all.
In the same way we give warnings to visiting overseas tourists about the danger of our beaches, we ought to be warning them about the risks of being injured in a motor vehicle in the Territory. Except for medical expenses, until you can be shipped out, you are on your own.
What should you do when travelling in the Territory?
It would be wise for anyone travelling in a motor vehicle in the Territory to make sure they have their own income protection insurance or substantial accident insurance. In fact, if you intend to drive in the Territory, you should treat it as visiting a Third World country and make sure you have substantial travel/accident insurance.
Section 11 A of the Act also provides that your own insurance cover reduces the paltry statutory benefits received under the Act to add further insult to injury. That is unbelievably draconian, but you would still be better off having your own insurance.
Despite the lack of adequate insurance in the Territory, is CTP insurance in the Territory cheaper than in Queensland?
I could not find a breakdown of the CTP insurance component of motor vehicle registration in the Territory. Still, by way of comparison, registration for one year for a vehicle up to 3-litre engine capacity in the Territory is $766.55, while it is $716.65 for a four-cylinder vehicle in Queensland.
Yet Queensland has virtually a full common law compensation system that is better and vastly superior to the draconian system in the Territory. Not only that, but all the CTP insurers in Queensland achieve more than adequate profits according to our Motor Accident Insurance Commission.
There ought to be an enquiry!
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