With the objective of overcoming the imbalance between the
benefits potentially available to a significant minority of those
injured on the roads by reason of the fault of others and those for
whom a claim for damages is not available, the Catastrophic Injury
Scheme has been conceived and a Green Paper recently released by
the Insurance Commission of Western Australia.
The idea of no fault insurance cover for those who suffer
catastrophic injuries in motor vehicle accidents is of course
nothing new, as similar schemes are already operating in other
The context in which it is to be viewed is best illustrated by
the statistics that show some 92 people annually are likely to
suffer catastrophic injury as a result of a motor vehicle accident
in WA, some 48% of whom will be ineligible to claim damages. The
Scheme is intended to provide enhanced benefits to that 48% and is
to operate under the continued auspices of the ICWA.
The model to be adopted for the Scheme is not yet decided, and
there are 2 principal options for providing the benefits. The Green
Paper acknowledges that the adoption of a scheme is not a foregone
conclusion and therefore postulates three options.
Option 1 no change to the existing CTP coverage;
Option 2 a no fault catastrophic CTP insurance scheme for all
people catastrophically injured, (including those who would have
otherwise brought a claim for damages);
Option 3 a no fault catastrophic CTP insurance scheme for those
catastrophically injured people not covered by the existing CTP
scheme (the 48%);
To cater for either options 2 or 3, an increase in annual motor
vehicle registration/insurance fees in excess of $100 will be
That is a sufficiently substantial increase to have a political
dimension. However in considering the value to be gained, it may be
noted that some 50% of all payments presently made under the CTP
scheme (some $260,000,000 annually) are paid in relation to
The features of the alternative models presently giving rise to
debate include the following:
The definition of catastrophic injury;
The principle that the introduction of a new scheme should not
disadvantage those who would otherwise have entitlements under the
existing CTP scheme (leading to support for option 3);
Whether there should be exclusions with respect to entitlement
under the new scheme, such as relating to criminal conduct, driving
under the influence of alcohol, driving without a licence and
others. A view in opposition to this would be that such exclusions
are antithetical the concept of a no fault scheme;
The management of issues arising from apportionment of
liability under option 3 (care costs would in any event be
Depending on funding arrangements within ICWA, whether any
issue of recovery of benefits paid under the Scheme would arise
where fault and a legal liability were established;
The qualifying criteria under option 3; and
Lump sum compensation for future care costs under option
Tragically, the likely impact of the proposed Scheme was sharply
illustrated recently when the damages claim of Warrick Proudlove
was dismissed after trial in the District Court. Warrick suffered
brain damage resulting in the need for 24 hour care, when in July
this year, the car in which he was travelling collided with a horse
near Mount Barker.
The District Court found that the accident had been unavoidable
and not due to the negligence of the driver of the car.
The significance of the decision of the court is that
Warrick's family will continue to bear the cost of care and
medical treatment, other than what would be available to a public
patient. Under a no fault scheme an enhanced range of such services
would be likely to be available to a victim of catastrophic injury
such as Warrick. It's pretty hard to argue with that.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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