Lawyers say the ACT's new compulsory third party insurance scheme hands too much power to insurance companies, while the Barr government says it will allow an extra 600 people injured on Canberra's roads to access medical treatment and income support per year.
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An exposure draft of the new scheme was tabled in the ACT Legislative Assembly on Thursday, and referred to the Justice and Community Safety Committee for further investigation.
The scheme was designed by the ACT's first citizens jury and will replace the existing at-fault, common law system.
Under the new scheme anyone injured in a motor vehicle accident will be able to access treatment, care and income support for up to five years, with the most seriously injured and the not-at-fault able to access additional benefits.
Even injured motorists who are charged with high-level drink driving, reckless or dangerous driving or killing another person using a motor vehicle will be eligible for treatment and care benefits while their charges are pending. However, once they are convicted, the benefits will stop.
Injured drivers who crashed because they were speeding or using their mobile phone will receive a 25 per cent cut to their payments.
Canberrans are expected to save between $91 and $171 on their yearly premiums under the new scheme, however, the costings are yet to be finalised.
ACT Chief Minister Andrew Barr said the final version of the legislation would be introduced by the end of the year, in the hope the scheme can start operating mid-2019.
"Canberra’s current CTP scheme doesn’t protect people as well as it should when they are on the road. For example, if someone is injured because they hit a kangaroo or lose control on an icy patch and run off the road, they can’t make a claim to cover their medical bills and lost income," Mr Barr said.
"Under the new scheme, everyone who is injured in a motor vehicle accident will be entitled to up to five years of medical treatment, care and lost wages – as long as they’re not breaking the law at the time of the accident."
However ACT Law Society president Sarah Avery said the changes were unfair and traded away the "current fair level of compensation provided to innocent road accident victims ... to pay benefits to the driver who caused the accident".
The legal profession mounted a huge challenge to the changes to the current at-fault scheme, which requires crash victims to go to court to receive their payouts, with some law firms even funding a rival deliberative democracy workshop.
"The society strongly opposes the arbitrary reduction of compensation payable to innocent road accident victims in order to pay for benefits to at-fault drivers," Ms Avery said.
"The imposition of a 10 per cent whole person impairment threshold will ensure that the vast majority of victims will no longer be able to access adequate compensation."
Ms Avery was also sceptical about the expanded role of insurance companies in administering the new scheme.
"The new scheme will rely on insurers to provide a range of information and advice to injured people," Ms Avery said.
"Insurance companies will have an expanded role in determining when and if compensation to injured people is paid.
"As recent experience in NSW and the current Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry has shown, information distributed by insurers is often inaccurate and legally incorrect."
An ACT government spokeswoman said there would be strict rules in place covering how insurers dealt with injured motorists.
"Unlike some of the insurance products discussed to date at the Royal Commission, the new scheme is a statutory scheme with an accompanying Motor Accident Injuries Commission," she said.
"The commission’s functions have changed compared to the existing CTP Regulator, to better reflect the role of the commission under the new scheme. Not only will the commission will have a stronger education role in providing better information about the scheme to people who are making claims, it will also have an expanded regulatory and monitoring role."
She said while insurers were required to provide people with information to help them through the scheme, the government would specify the information and its format.
"Information will also be provided by the Motor Accident Injuries Commission via a new website, and claimants will also be able to get help in making applications for defined benefits through approved information support services such as community legal centres," she said.
"The bill allows the Motor Accident Injuries Commission to approve a person to provide information support services for applicants under the new scheme. Guidelines will make provision for approving information support services, including the qualifications of providers, and the services to be provided. The regulations will set out a schedule of fees that insurers will be required to pay for a given service."
The details of the new scheme are available on yoursay.act.gov.au/ctp.
