NSW drivers to see CTP costs cut further in 2022

The New South Wales government announced further reductions to compulsory third party (CTP) car insurance premiums at the weekend, highlighting the impact of 2017 CTP reforms.

All drivers in Australia are legally required to hold CTP insurance, although its name and pricing differs between the states and territories. This minimum level of insurance covers a certain amount of costs that may arise when someone is injured or killed in a road accident. 

The minister for digital and customer service Victor Dominello said in a statement that the reforms have so far delivered the lowest premiums seen in the state for a decade. A further slashing of $19 a year on CTP premiums will bring the average annual cost for NSW residents down below $470 by 2022.

“From a state-wide average high of $635 in 2016, the government’s reforms will have delivered a 27% reduction in premiums by early 2022,” Dominello said.

But the government’s reasoning for these reforms goes beyond cost-savings for consumers. According to the NSW State Insurance Regulatory Authority (SIRA), an injured person waited on average between three and five years to receive compensation prior to the reforms. There were also fraudulent claims adding to the cost of green slips, little support for claimants who were at-fault in an incident, as well as excessive insurance company profits.

What’s changed about CTP for NSW drivers?

Apart from continued cost reductions, nothing is changing for NSW drivers. But for a bit of background, here are some of the other major changes the 2017 CTP reforms have brought about:

• Reduced claim waiting times. The government’s weekend statement said 78% of injured people have received benefits within three months of their accident since the reforms, compared to 26% previously.
• More benefits for injured at-fault drivers. The previous CTP scheme capped compensation at $5,000 for at-fault drivers. Now, they can receive weekly benefits of varied amounts (depending on the nature of their claim) for up to six months.
• Security for people involved in blameless accidents. This ensures people injured in road accidents where nobody was deemed at-fault (like a collision with wildlife or unforeseen mechanical failures) are able to access benefits with greater ease.
• Compensation for minor injuries capped. Those with minor injuries will only be able to access cover to pay for medical expenses for six months, and won’t be able to make a claim for common law damages.
• Seriously injured people can receive medical and care cover for life. When not-at-fault, they can also claim cover for income for up to two years and make a common law claim for further compensation for past or future economic loss.

For more information on the reforms and conditions around these benefits, head to the SIRA CTP Green Slip reforms explainer page. If you’re keen to give your comprehensive car insurance a once over to make sure it’s still a competitive offer, compare it against a few of the policies below.