COAG Decision Regulation Impact Statement – Standing Council on Federal Financial Relations
In March 2017, the Australian States and Territories agreed to implement a National Injury Insurance Scheme (NIIS) for people who have been catastrophically injured in motor vehicle accidents. The States and Territories further agreed to impose an agreed set of minimum benchmarks for these schemes.
The NIIS works alongside the National Disability Insurance Scheme (NDIS). It is intended to prescribe a minimum level of compensation across all jurisdictions to people who sustain a catastrophic injury from a motor vehicle, workplace, medical treatment injury or general accident. The first of these to be considered is motor vehicle accidents.
Existing support for people who are catastrophically injured in a motor vehicle accident varies across jurisdictions. Currently no-fault third party motor vehicle insurance is in place in New South Wales, Victoria, South Australia, Tasmania, the Australian Capital Territory, and, to an extent, the Northern Territory. This means that where a person is catastrophically injured they are entitled to compensation regardless of which party in the accident is at fault. The other jurisdictions have fault-based schemes, which means that to receive compensation the injured party must identify an at-fault third party and progress the claim through Court.
The Decision RIS was prepared for the Standing Council on Federal Financial Relations and assessed as compliant with the Council of Australian Governments (COAG) RIS Guidelines by the Office of Best Practice Regulation (OBPR).
The RIS notes the main issue is the low quality of care provided to injured parties in jurisdictions that do not have no-fault schemes. Where the injured party identifies an at-fault party, the matter must be progressed through Court, which can deliver variable outcomes. If the injury is self-inflicted the injured party must either rely on private insurance or public welfare which are both considered, for different reasons, to provide inadequate compensation.
The RIS notes the main impacts of the proposed changes will be in those jurisdictions (Queensland and Western Australia) which do not have no-fault schemes. In particular, it is expected that insurance premiums will increase in those jurisdictions, while people who are catastrophically injured in a motor vehicle accident will receive more compensation on average.