Delayed Insurer Decisions and Their Effect on Treatment and Rehabilitation
If an insurer delays making a decision on a Compulsory Third Party (CTP) claim in New South Wales, it can significantly affect a claimant’s access to timely treatment and rehabilitation planning. Under the Motor Accident Injuries Act 2017 (MAIA), insurers are required to assess claims and determine entitlements to benefits such as treatment and care, weekly income payments, and, where applicable, damages. Delays in this process may result in a delay in authorising medical treatment, rehabilitation services, or financial support, which can impact recovery outcomes. This is particularly relevant in Greater Sydney, where access to specialist care and rehabilitation services is high, but reliance on insurer approval can create bottlenecks.
Legal Framework for CTP Claims in NSW
All CTP claims in NSW are governed by the Motor Accident Injuries Act 2017, which replaced the earlier Motor Accidents Compensation Act 1999. The MAIA establishes a statutory framework for claim management, including timelines for insurer decisions. Insurers must assess a claim within 28 days of receiving a completed claim form and supporting evidence. Failure to meet this deadline may result in the claimant being entitled to a statutory benefit, including treatment and care, even if the insurer has not formally approved it.
The Act also provides that treatment and care benefits must be provided as soon as practicable after a claim is accepted. Insurers are required to make decisions on whether to accept or reject a claim within 28 days, and to notify the claimant in writing. If the insurer fails to decide within this timeframe, the claimant may be entitled to treatment and care benefits under the statutory scheme, regardless of formal acceptance.
Impact on Treatment and Rehabilitation Planning
Delayed insurer decisions can disrupt the continuity of treatment and rehabilitation planning. Rehabilitation planning under the MAIA requires a coordinated approach between medical practitioners, allied health professionals, and the insurer. When an insurer delays authorising treatment, claimants may face gaps in care, including delays in physiotherapy, psychological support, or specialist assessments. This can affect recovery timelines and long-term functional outcomes.
SIRA, the State Insurance Regulatory Authority, has issued guidance stating that insurers must not unreasonably delay authorisation of treatment. If a claimant has received a medical report confirming the need for treatment and the insurer has not responded within 28 days, the claimant may proceed with treatment under the statutory entitlement. The insurer remains liable for the cost of treatment provided during this period, provided it is reasonable and necessary.
Practical Steps for Claimants Facing Delays
If an insurer has not made a decision on a CTP claim within 28 days, claimants should take the following steps:
- Confirm that a completed claim form and supporting evidence (including medical reports, accident details, and income records) have been submitted.
- Obtain a written record of submission, including a date stamp from the insurer or a registered post receipt.
- Request a formal written response from the insurer outlining the reason for the delay.
- If no response is received within 28 days, proceed with treatment under the statutory entitlement and keep all records, including invoices, appointment confirmations, and correspondence.
- Contact SIRA’s claims assistance team for guidance on claim management and dispute resolution.
Photographs of the accident scene, witness contact details, and a copy of the police report (if applicable) may also support a claim that the insurer has not acted within the required timeframe.
Escalation and Dispute Resolution
If an insurer continues to delay or refuses to authorise treatment, claimants may escalate the matter through SIRA’s dispute resolution process. SIRA provides a formal mechanism for resolving disputes about claim decisions, including delays in authorising treatment or rehabilitation services. This process is free and does not require legal representation.
A claimant may also request a review of the insurer’s decision by the insurer’s internal review process, which must be completed within 28 days of the initial decision. If the internal review upholds the original decision, the claimant may then apply to SIRA for a determination.
Hypothetical Example: Delayed Treatment in Greater Sydney
A 34-year-old cyclist in Sydney’s Inner West was involved in a motor vehicle accident on 15 May 2026. The cyclist sustained a soft tissue injury to the neck and back, and a medical practitioner confirmed the need for physiotherapy and psychological support. The claim form was submitted to the insurer on 20 May 2026. By 10 July 2026, no decision had been received. The claimant began treatment on 1 July 2026, relying on the statutory entitlement under the MAIA. The insurer later accepted the claim, but the claimant had to cover initial treatment costs. SIRA confirmed that the claimant was entitled to reimbursement for treatment provided during the 28-day delay period, as long as the treatment was reasonable and necessary.
When to Seek Independent Advice
While SIRA provides guidance and dispute resolution, claimants facing prolonged delays or complex medical issues may benefit from independent legal advice. A solicitor experienced in CTP claims can assist in drafting formal correspondence, challenging unreasonable delays, and ensuring entitlements are not overlooked. This is particularly important if the claim involves a threshold injury, a dispute over impairment, or a need for long-term rehabilitation planning.
Next Steps for Claimants
Every claim depends on its own facts. To request contact about your circumstances, complete the quick, no obligation enquiry form.