Late Payment Interest in NSW CTP Claims
When a CTP insurer delays statutory benefits, claimants may be owed interest under the Motor Accident Injuries Act 2017 (MAIA). This article explains what claimants (PICs) can expect in disputes over late payment interest, how such issues are resolved, and the practical steps to pursue compensation.
Legal Framework for Payment Interest
- Under the MAIA, CTP insurers must pay statutory benefits such as weekly payments and treatment and care benefits within 14 days of a claim being accepted. If payment is delayed, the insurer may owe interest under the
- Statute of Limitations* provisions. While the MAIA does not explicitly mention interest, SIRA guidelines state that insurers must pay benefits promptly, and delays may trigger statutory obligations under the
- Civil Procedure Act 2010*.
How Disputes Over Payment Interest Are Resolved
Disputes typically involve the insurer denying liability for interest. Claimants should first request a written explanation for delays. If unresolved, the Personal Injury Commission (PIC) can be contacted to escalate the matter. The PIC may mediate or refer the issue to the NSW Civil and Administrative Tribunal (NCAT) for resolution. SIRA advises claimants to document all communication with insurers and keep records of payment delays.
SIRA Guidance on Payment Timelines
- SIRA’s
- Making a Motor Accident Claim* page confirms that insurers must pay accepted claims within 14 days. While the MAIA does not specify interest, SIRA’s
- What You Can Claim* page states that claimants may seek compensation for financial losses caused by delayed payments. This includes lost income or additional costs incurred due to the delay.
Practical Steps for Claimants
- Document Payment Delays: Keep records of all correspondence with the insurer, including dates of claim acceptance and payment.
- Request Written Explanation: Ask the insurer to confirm whether they owe interest for delayed payments.
- a. Seek Legal Advice: If the insurer denies interest, consult a solicitor to assess whether statutory obligations apply.
- Use the PIC’s Dispute Pathway: The PIC offers free assistance for resolving disputes, including mediation and formal review requests.
- Prepare Evidence: Gather evidence of financial impact, such as bank statements or invoices, to support claims for interest.
Example Scenario
A claimant receives a 14-day notice of claim acceptance but is not paid for 21 days. The insurer denies owing interest, arguing the MAIA does not mandate it. The claimant can argue that the delay caused financial harm and request compensation for the additional period. The PIC may intervene to clarify whether interest is owed under the Statute of Limitations.
When to Seek Advice
If the insurer refuses to pay interest or disputes the claim, it is essential to seek legal advice promptly. Delays in resolving disputes may reduce the chances of recovering interest, as the Statute of Limitations may limit claims for financial losses.
Next Steps
Time limits and procedural requirements may apply. To request contact about your circumstances, complete the quick, no obligation enquiry form.