1 LAWYERS New South Wales & Victoria Transport Accident Commission (TAC) Claims FREQUENTLY ASKED QUESTIONS What is a transport accident? A transport accident is an incident directly caused by a motor car or motor vehicle, a railway train, or a tram. What is the Transport Accident Commission (TAC)? The TAC is a Victorian government-owned agency that administers the transport accident compensation scheme. The TAC is required to pay no fault compensation to people injured in transport accidents, to provide rehabilitation for those injured in transport accidents, and to try to reduce the road toll by promoting road safety. The TAC is also the compulsory third party insurer of all motor vehicles registered in Victoria. The TAC office is located at 60 Brougham Street, Geelong. Its postal address is PO Box 742, Geelong, VIC The TAC runs an enquiry call centre , or STD toll free The facsimile number is (03) The TAC website is Who is covered by the transport accident scheme? A person who is injured as a result of a transport accident is entitled to no fault benefits under the transport accident scheme if: the accident occurred in Victoria or the accident occurred outside Victoria (but in Australia) and involved a Victorian registered motor vehicle and at the time of the accident the injured person was:
2 2 o o a Victorian resident or the driver of or a passenger in the Victorian registered vehicle. A person who was dependent on another person who dies as the result of a transport accident may be eligible for benefits. How do I lodge a claim for compensation (a TAC claim)? You can lodge a claim by ringing the TAC call centre on or toll free on See below for information regarding time limits. Are medical and like expenses covered? Yes. All ambulance bills are covered. All public and private hospital bills are covered. All medical, radiological, pharmaceutical, and like expenses are paid in full by TAC provided that you have received treatment as an overnight inpatient in a hospital on account of your injuries. If you were not a hospital inpatient, an excess of $ applies before TAC is responsible to pay nonhospital medical and like expenses. When do medical expense payments from the TAC cease? The TAC has a legal obligation to continue funding reasonable and accident related hospital, medical, and like expenses indefinitely. The payment of a lump sum impairment benefit (see below) or common law damages (see below) does not bring this entitlement to an end. However, if the TAC considers that medical treatment is unrelated to injuries a claimant may have sustained in the accident, it can refuse to fund such treatment. Likewise, if the TAC considers that a particular medical treatment is unreasonable, it can refuse to pay for it. Is lost income covered by the TAC? If you were an earner before the accident, and you are unable to work on account of your injuries, the TAC has an obligation to pay benefits for loss of income ( income benefits ). Income benefits are calculated at 80% of your pre-accident income less income tax, up to a statutory weekly maximum. This entitlement lasts for a period of 18 months from the date of the accident. In this 18 month period, the entitlement is known as loss of earnings (LOE) benefits. The TAC does not have to pay LOE benefits for the first 5 working days during which a claimant is unable to return to work. If you are unable to return to full time employment but can work part time, you may be entitled to receive a partial LOE payment during the initial 18 month period. If you are still unable to work 18 months after the accident, the TAC still has a liability to pay income benefits for an additional 18 months. The TAC therefore provides a total period of 3 years income protection for most accident victims. At the end of the first 18 months, the nature of the entitlement alters somewhat and is known as loss of earning capacity (LOEC) benefits. The LOEC benefit is calculated by taking a number of variables into account.
3 3 Some accident victims, whose level of permanent impairment is determined by the TAC at 50% or more, have an entitlement to receive LOEC benefits until retirement age subject to some conditions. When do income benefits cease? LOE benefits cease 18 months after the accident. LOEC benefits cease 3 years after the accident except in cases where the accident victim s level of permanent impairment is determined by the TAC at 50% or more, in which case the entitlement ceases upon the accident victim reaching normal retirement age subject to some conditions. In a practical sense, LOE and LOEC benefits also cease if you stop sending the TAC medical certificates that evidence an incapacity for work. They can also be terminated by the TAC in circumstances where the TAC is of the view that your injuries no longer incapacitate you for work. Does the TAC pay lump sum compensation? Yes. The TAC pays a no fault lump sum benefit called an impairment benefit to eligible accident victims. As the compulsory third party (CTP) insurer of all Victorian registered motor vehicles, in cases where serious injury is established, the TAC may pay lump sum awards of common law damages to seriously injured transport accident victims. What is an impairment benefit? An impairment benefit is a no fault lump sum payment designed to compensate for pain and suffering. To be eligible to receive an impairment lump sum payment, your level of impairment, expressed as a percentage of the whole body/person, must exceed 10%. The impairment percentage is calculated by the TAC after having you examined by medical specialists who have successfully completed an accreditation course in the use of the impairment guides. Impairment percentages are calculated using the methods contained in the Guides to the Evaluation of Permanent Impairment 4th Edition, published by the American Medical Association. It is important to note that impairment is different from disability. The impairment guides do not assess disability. They assess only impairment. Although the impairment guides are said to be scientific, experience shows that the application of the guides by similarly qualified medical specialists often produces significantly different impairment outcomes. Expert legal advice concerning the impairment issue is strongly recommended. What is the impairment benefit worth? Accidents before 16 December 2004 In the case of accident victims injured in transport accidents occurring before 16 December 2004, the impairment benefit was worth approximately $1, for each impairment percentage point over 10. No impairment benefit is payable for the first 10 impairment points. Accordingly, an impairment score of 20%
4 4 would produce an impairment benefit of approximately $11, The maximum that can be paid for accidents that occurred before 16 December 2004 is currently $100, A table containing the formula for the lump sum amounts for accidents before 16 December 2004 can be seen at the end of this document under Tables (page 10). Accidents occurring on or after 16 December 2004 Accident victims injured in transport accidents occurring on or after 16 December 2004 are entitled to a considerably higher level of benefits. The benefit payable for an 11% impairment is $7, and it increases by $1, for each impairment point up to 19%. A 20% impairment produces a lump sum of $19, and each additional point up to 49% is worth $1, The maximum that can be paid for accidents occurring after on or after 16 December 2004 is currently $320, A table containing the formula for lump sum amounts for accidents on or after 16 December 2004 can be seen at the end of this document under Tables (page 10). When is an impairment benefit paid? An impairment benefit used to be paid 18 months after the accident. However, due to a recent amendment to the Transport Accident Act, interim impairment benefits can now be paid to accident victims at any time commencing 3 months after the accident. Provided an injury is stable, the TAC can assess and determine the impairment applicable to that injury and pay a benefit. In the case of children (i.e., victims under the age of 18 years), the final impairment determination is made at 18 years of age. What happens if the TAC makes a decision you don t agree with? If you are unhappy about the decision the TAC makes concerning an entitlement to any no fault benefit, you have a period of 12 months within which to challenge that decision by means of an appeal to the Victorian Civil and Administrative Tribunal (VCAT). The 12 month period commences when you are notified of the decision, that is, on the day that you become aware of the decision. Accident victims who are represented by a lawyer must engage in a no fault dispute resolution protocol that requires a comprehensive exchange of information concerning the disputed decision, leading up to a dispute resolution conference, before you can proceed to the formal VCAT appeal process. What if I am injured in a transport accident in the course of my employment? If you are injured in an accident that occurs in the course of your employment, other than when you are travelling to or from work, you are not entitled to receive TAC benefits. In these circumstances, you are entitled to receive benefits under the WorkSafe scheme. For further information regarding WorkSafe claims, we recommend obtaining legal advice from expert WorkSafe lawyers.
5 5 What if I was driving an unregistered vehicle? If you were the driver of a vehicle owned by you that is unregistered and you are injured in a transport accident, you would be ineligible to receive income/loe benefits for the first 18 months after the accident. You would otherwise be entitled to receive all other no fault benefits. What if I was driving and had been drinking? If you were the driver and suffered injuries in the accident, your entitlement to receive income/loe benefits in the first 18 months will be reduced by 1/3 if your blood alcohol level was more than 0.05% but less than 0.12%. There will be a 2/3 reduction if the reading was 0.12% or more but less than 0.24%. No benefit is payable if the blood alcohol reading was 0.24% or more. If the alcohol played no role in causing the accident, these reductions do not apply. The reductions apply only to drinking drivers. They do not apply to passengers or pedestrians. What if I was driving while unlicensed? The driver of a vehicle involved in a transport accident, who at the time of the accident was unlicensed or had their licence suspended, is not entitled to income/loe benefits in the first 18 months after the accident. Otherwise, the person is entitled to all of the other no fault benefits. What if I were injured on my way to or from work? If you were injured on a journey from your home to your workplace or from your workplace to home, your entitlements to compensation fall within the transport accident scheme. What if the accident was my own fault? The TAC Scheme is essentially a no fault scheme. Accordingly, even if the accident was your own fault, you may still be entitled to no fault benefits. You would not be entitled to pursue a common law claim or recover common law damages unless you could prove that someone else was at fault. Do I have to live in Australia to be covered by the TAC? No. Overseas residents can make a TAC claim if the transport accident in which they were injured occurs in Victoria. The TAC will be liable to cover any medical or treatment expenses incurred within Australia; however, the TAC is not liable to pay any hospital, medical, or like expenses incurred outside Australia. The TAC also has a liability to pay income benefits, LOE benefits, and LOEC benefits to an accident victim who resides outside Australia. Similarly, the TAC has an obligation to pay the impairment lump sum benefit to a person who resides outside Australia.
6 6 Accident victims who reside overseas can still bring a common law damages claim if they suffer a serious injury and can prove that the injuries resulted from the negligence or carelessness of another person. In such a common law claim, the accident victim can recover damages for medical costs incurred outside Australia and also an allowance for future medical costs that will be incurred outside Australia. It is very important for non-australian residents injured in transport accidents in Australia to seek expert legal advice concerning their rights. It is possible for such accident victims to inadvertently lose their rights under the transport accident scheme. Expert legal advice must be obtained and we have extensive experience acting for overseas residents injured in Victorian transport accidents who have TAC claims. Is compensation payable for death? Yes. Any dependant of a person who dies as a result of a transport accident is entitled to receive a lump sum payment and a weekly loss of dependency benefit. The weekly benefit is payable for a period of 5 years or until the youngest dependant child completes full time education, whichever last occurs. The maximum weekly benefit payable is currently $1, The maximum lump sum death benefit is currently $168, Dependant children also have an entitlement to an education allowance. Family members are entitled to counselling paid by the TAC to enable them to cope with the death of their loved one. Expert legal advice should be obtained concerning the entitlement to and quantum of the death benefits. Who can receive death benefits from the TAC? Any dependant children of the deceased and the dependant spouse of the deceased can receive benefits from the TAC. The surviving spouse of the deceased person is also eligible in circumstances where the deceased person wasn t working but was engaged in the full time care of children of the deceased. Again, expert legal advice needs to be obtained about these matters. Who can sue for TAC common law damages? Anyone who suffers a serious injury in a transport accident can sue the person whose negligence caused the accident in order to recover TAC common law damages. There are two key requirements. The injured person must be seriously injured, and her/his injuries must have been caused by the negligence of the other driver. What is a serious injury? A serious injury is a formal, legal classification. It is defined as: serious long term impairment or loss of a body function permanent serious disfigurement a severe long-term mental or severe long- term behavioural disturbance or disorder or loss of a foetus.
7 7 The definition of serious injury has been interpreted by the Victorian Court of Appeal. The question of serious injury is technical and complex. However, in simple terms, it is not the injury as such that must be serious, but the consequences of the injury. If you believe that you might have sustained a serious injury as a result of the negligence of some other person, you should obtain expert legal advice. What damages can be recovered in a TAC common law claim? There are two types of damage that can be recovered in a TAC common law claim. You can obtain an award for pain and suffering damages. You can also obtain an award for pecuniary (economic) loss damages. In rare cases, it is possible to obtain an award of damages for future medical costs (e.g., see on page 5 Do I have to live in Australia to be covered by the TAC?). However, in the vast majority of cases, damages for future hospital, medical, and like expenses are not recovered because the scheme provides for an ongoing entitlement to have TAC pay hospital, medical, and like expenses indefinitely, even after resolution of the common law claim. The amount of common law damages payable depends on several factors. You should obtain expert legal advice in relation to the question of TAC common law damages. How are damages calculated? Pain and suffering damages, as the name suggests, are awarded for the pain, suffering and loss of enjoyment of life experienced as a result of the injuries. There is no yard stick or scale that applies to the assessment of pain and suffering damages. The personal circumstances of the accident victim are considered in detail in assessing these damages. Every case is different. Expert legal advice is required in order to determine the likely award of pain and suffering damages in a TAC common law claim. Pecuniary loss or damages for income loss (past and future) can be awarded only for income lost from 18 months after the accident up until the time that the claim is resolved. You are entitled to recover the nett (after tax) income that you would have earned during the relevant period had the accident not occurred. You are also entitled to recover damages for future impairment of earning capacity. Again, the assessment of lost earning capacity damages is based upon the accident victim s personal circumstances. The assessment takes into account pre-accident earning capacity and any earning capacity retained by the accident victim despite the injuries. The calculation of damages for future losses not yet incurred involves the application of an actuarial formula in order to work out the size of the lump sum that should be paid to compensate for this particular loss. The lump sum also reflects the normal risks of life. Generally, a lump sum for lost earning capacity will be reduced by about 15% to cover the risks of living. Again, you should obtain expert legal advice in relation to the question of pecuniary loss damages. Who pays the damages? The damages are ordered to be paid by the defendant i.e., the person you sue. In the vast majority of cases, the person you sue is the driver or owner of a motor vehicle. In such cases, the compulsory third party insurer is the body that pays the damages on behalf of the named defendant. In most TAC common law claims, the TAC itself is the organisation that pays the common law damages.
8 8 All Victorian motorists who pay registration fees on their cars effectively pay an insurance premium to the TAC. A component of the vehicle registration fee is paid into the TAC fund and all payments are used to fund the transport accident scheme. Consequently, the TAC becomes liable to pay transport accident victims their relevant entitlements out of the fund and on behalf of any owner or driver of a Victorian registered motor vehicle who has paid their registration fees. How soon after an accident can I claim TAC common law damages? Before being able to sue for damages you must be classified as having suffered a serious injury. Before you can be classified as having suffered a serious injury, you must have undergone an impairment assessment. An impairment determination will not be made until your injuries are stable or at least substantially stable. In some cases, such as those involving catastrophic spinal cord injuries or amputations, it is possible to have the impairment determined and the serious injury classification made within a few months of the transport accident. In other cases, where the injuries require a lot of ongoing treatment, it might take a year or more for the injuries to become stable. Every TAC claim is unique and the injuries suffered by TAC claimants varying significantly. Therefore, it is essential that you seek expert legal advice about your claim, your injuries and the potential time frames for entitlements. Does the TAC still pay benefits after a common law claim is resolved? Yes. The TAC is obliged to continue paying for reasonable accident-related hospital, medical, and like expenses as part of a TAC claim. The resolution of a common law damages claim brings to an end the entitlement to receive LOEC benefits. It also brings to an end any entitlement to receive an impairment lump sum payment. Expert legal advice should be obtained concerning these matters. Will I have to repay Centrelink from TAC common law damages? If you have received Centrelink benefits between the date of the accident and the resolution of your common law claim, and you recover pecuniary loss damages (i.e., damages for lost income and impaired earning capacity), you will have to repay the amounts you have received from Centrelink. Further, depending upon the size of your damages award, you may also be ineligible to receive Centrelink benefits for a period of time in the future. Because of this, it is important that recipients of TAC common law damages obtain independent, expert investment advice after resolution of the damages claim. Are there time limits that apply to TAC claims? Yes. The time limits are: To lodge a TAC claim for compensation one year from the date of the accident or from the date the injury first manifested itself. The TAC does have discretion to accept a claim lodged after 12 months
9 9 but within 3 years of an accident, provided the accident victim can provide reasonable grounds for late lodgement. To challenge no fault benefit decisions made by the TAC A 12 month period within which the accident victim can challenge the decision by means of lodgement of an appeal with the VCAT. The 12 month period runs from the date the accident victim first became aware of the decision. It is important to note that the TAC also has an internal review process. Applying for an internal review by the TAC does not stop the clock in relation to the 12 month limitation period. Time still runs even if an internal review is being undertaken. To bring forward a TAC common law damage claim Within 6 years of the accident. It is possible, however, for claims to be brought after the 6 year period has expired but only in limited circumstances. It is imperative that expert legal advice be obtained in relation to the TAC common law damages time limit. Gibney & Gunson Lawyers Lavington 2/346 Griffith Road PO Box 594 Lavington NSW 2641 DX 5835 Albury Ph: (02) Fax: (02) Wodonga 18 Jarrah Street Wodonga VIC 3690 Melbourne 74/299 Queen Street Melbourne VIC 3000
10 10 Tables Impairment Ratings and Lump Sum Benefits Accidents prior to 16/12/2004 As of 01/07/2013 % $ 11% $1, % $11, % $22, % $33, % $44, % $56, % $67, % $78, % $89, % $100, Impairment Ratings and Lump Sum Benefits Accidents on or after 16/12/2004 Indexed benefits as of 01/07/2013 % $ 11% - 19% $5, ([D-10] x $1,290.00) 20% - 49% $19, ([D-20] x $1,900.00) 50% - 59% $76, ([D-50] x $2,230.00) 60% - 79% $99, ([D-60] x $2,540.00) 80% - 89% $152, ([D-80] x $5,070.00) 90% - 99% $208, ([D-90] x $10,160.00) 100% $320, Where D is the degree of impairment expressed as a percentage.