New Bill Proposes Changes to NSW Motor Accident Legislation

KEY TAKE-OUTS

• The Motor Accident Injuries Amendment Bill 2022 was introduced into NSW Parliament on 19 October 2022
• The proposed amendments have emerged out of the Clayton Utz and Deloitte Statutory Review of the Motor Accident Injuries Act 2017 Report
• The Bill proposes to make a number of changes, some of which will affect benefits for persons injured in a motor vehicle accident and the legislative process for bringing a clccasffaim

The Motor Accident Injuries Amendment Bill 2022 (“the Bill”) was introduced into NSW Parliament on 19 October 2022. The Bill proposes to make a number of changes to the existing legislation, some of which affect an injured person’s statutory benefits. In this blog, we set out the proposed amendments and how it compares to the current law.

The Key Proposed Changes, The Law Currently, and the Potential Effect

1. A Change in Terminology

One of the key proposed changes to the current law is to omit reference and definition to the term ‘minor injury’. Currently, the law provides that a ‘soft tissue injury’ or ‘psychological or psychiatric injury that is not a recognised psychiatric illness’ is a ‘minor injury’.

The term ‘minor injury’ has repetitively been criticised as trivialising an injury, undermining the impact on an injured person, and the use of the term has been reported to cause unnecessary distress to an injured person.

The Bill proposes to replace the term ‘minor injury’ with reference to a ‘threshold injury’. In effect, the change in terminology does not change the substantive definition of the term, nor the operation of the relevant provisions, but is somewhat less insulting to persons who do not reach the requisite ‘threshold’ to lodge a damages claim.

2. An Extension of Weekly Payments and Medical Treatment

Another proposed change to the legislation is to extend the first entitlement period of statutory benefits payable to a person injured in a motor vehicle accident to 52 weeks. Currently, persons who are mostly at fault or sustain ‘threshold’ injuries only, are not entitled to weekly benefits after 26 weeks.

Should the proposed amendment be passed by Parliament, persons who are primarily at fault or sustain ‘threshold’ injuries only will be entitled to weekly benefits for up to 52 weeks and medical treatment of at least 52 weeks. This will ensure that persons injured in a motor vehicle accident will have greater and consistent financial support for both loss of earnings, and for treatment and care, in turn providing additional support to better enable a person to return to work and their pre-accident activities.

3. Clarity as to What Constitutes ‘Reasonable’ Treatment and Care

Thirdly, the Bill proposes to establish a guideline-making power for the types of treatment and care that would be considered reasonable and necessary in the circumstances. Currently, there is no clear guideline as to what constitutes ‘reasonable and necessary’ treatment and care, which results in a large proportion of treatment and care requests in dispute. In effect, this change will reduce the need for insurer decision-making, reduce the need for injured persons to interact with the insurer, expedite treatment requests and an injured person’s access to treatment, enhance the autonomy in the scheme of injured persons, and will provide consistency in the scheme.

4. Expediating Disputes Relating to Permanent Impairment

The Bill further seeks to amend the Act so that an internal review is not required for a decision relating to the degree of an injured person’s permanent impairment. Currently, where there is a dispute as to an injured person’s degree of permanent impairment, the Claimant must first seek an internal review of the insurer’s decision before the matter can be referred to the Personal Injury Commission for referral to a medical assessment. This change will expedite claims and facilitate quicker progress of such medical disputes.

5. Removing the Waiting Period

Section 6.14 of the Motor Accident Injuries Act 2017 currently provides that ‘a claim for damages cannot be made before the expiration of 20 months after the motor accident…unless the claim is in respect of the death of a person or injury resulting in a degree of permanent impairment of the injured person that is greater than 10%’. What this means is that, currently, an injured person who does not sustain at least 10% permanent impairment, must wait a period of 20 months before a common law damages application can be served on the insurer. This leaves a lot of injured persons waiting in ‘limbo’ before they can progress their claim to the next stages.

The Bill proposes to remove the 20-month waiting period so that injured persons who sustain a ‘threshold injury’ and who aren’t wholly or mostly at fault for the motor vehicle accident, can lodge damages claim at any time. The removal of this waiting period will allow claims to commence and be finalised quickly and will reduce the emotional and psychological strain of a lengthy claims process.

When Will the Changes Come into Effect?

It is too soon to tell! The Bill is currently in the Legislative Assembly with the debate currently adjourned for 5 clear days. The Bill will need to be passed before both Houses before it is forwarded to the Governor for assent, following which the amendments will typically come into force 28 days after it is assented to or on 1 April 2023 by proclamation.

Watch this space!