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CTP help under scrutiny as legal costs drop

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The NSW State Insurance Regulatory Authority (SIRA) is looking at options to improve legal support and assistance for people injured in motor accidents after a review found some claimants may need more help navigating the scheme following reforms.

A Taylor Fry report delivered to SIRA also suggests “room for improvement” in insurer internal reviews and proposes the issue should be considered as part of this year’s independent examination of the CTP scheme.

Disputes and legal costs have fallen below levels expected following Motor Accident Injuries Act 2017 reforms that cut back the involvement of lawyers and shifted from lump-sum damages to weekly payments for minor injuries.

The level of disputes and legal cost decline could show both that the scheme is working better than expected and that some injured people require more assistance, the report says. A “honeymoon” impact of reforms could also be having an impact.

“There is some evidence to suggest that there is currently a deficiency in the understanding that some claimants have of the scheme and of their entitlements, and that some claimants find the scheme difficult to navigate,” Taylor Fry says.

The report proposes that, independent of other reforms, the SIRA-operated CTP Assist information service, described as valuable, yet underutilised, should have an expanded role and be more actively promoted as a first point of call for injured people.

Other options include reviewing the triggers for entitlement to legal services or introducing a modified version of the Independent Legal Assistance and Review Scheme that operates in workers’ compensation.

Taylor Fry says the overall success rate at insurer internal review is around 30%, and closer to 50% for some matters, while claimants that are unsuccessful have an overall success rate of 40% at the Dispute Resolution Service (DRS).

“Given the responsibility on CTP insurers to assist claimants through the process, the resultant level of challenge and disputation, and the ultimate success rate of those challenges, in our view seems to be too high,” the report says.

Taylor Fry says SIRA may want to await the outcome of the current wider review of the CTP scheme underway before considering changes, while DRS activity has also recently been rolled into a new Personal Injury Commission.

SIRA says a statutory review of the Motor Accident Injuries Act 2017, which is due to report to Minister for Digital and Customer Service Victor Dominello at the end of the year, will also consider findings from the legal support review.

The Taylor Fry report is available here.