Understanding Late Payment Interest in NSW CTP Claims
If a CTP insurer in New South Wales fails to pay statutory benefits on time, they may be required to pay penalty interest under the Motor Accident Injuries Act 2017. This applies to payments for treatment and care, weekly income support, and other benefits provided under the statutory scheme. The interest is calculated at a rate set by the NSW Government and is payable from the date the insurer should have made the payment. This interest is not discretionary, it is a legal obligation when payments are delayed without a valid reason.
In Bathurst and across NSW, the same rules apply regardless of location. The insurer must pay interest on any overdue benefit, including payments made after a claim has been accepted. The interest continues to accrue until the full amount is paid, and it is not limited to a specific period. This means that delays in processing claims, approving treatment plans, or issuing payments can result in a financial liability for the insurer.
How Late Payment Interest Affects Treatment and Rehabilitation Planning
Treatment and rehabilitation planning under the CTP scheme is designed to help injured people recover and return to normal activities. The process is managed by the insurer, who must approve treatment that is reasonable and necessary. However, delays in approving treatment, particularly when the insurer has not provided a written response within a reasonable time, can trigger interest payments on any benefits that were withheld.
For example, if a medical practitioner in Bathurst submits a treatment plan for physiotherapy and the insurer does not respond within 21 days, the claimant may be entitled to interest on any weekly payments that were not made during that period. The insurer cannot delay approval indefinitely. If a claimant seeks treatment and the insurer fails to act, the claimant may have a right to seek a review or apply to the NSW Civil and Administrative Tribunal (NCAT) for a determination.
The impact on rehabilitation planning is significant. Delays in treatment approval can prolong recovery, reduce functional outcomes, and increase long-term care needs. Where the insurer’s delay causes a worsening of the injury or extends the recovery period, the claimant may have grounds to seek additional compensation, but only if they can demonstrate a direct link between the delay and the harm suffered.
Practical Steps for Injured People in Bathurst
If you believe your CTP insurer has delayed payments and you are entitled to interest, you should take the following steps:
- Document all communications with the insurer, including emails, letters, and call logs.
- Keep copies of all medical reports, treatment plans, and invoices for services received.
- Note the date the insurer was notified of the treatment and the date they failed to respond.
- Request a written explanation for any delay in payment.
- If the insurer does not respond within 21 days of a treatment approval request, you may be entitled to interest on any benefits that were not paid.
In Bathurst, claimants can contact the SIRA (State Insurance Regulatory Authority) for information on how to make a formal complaint about a delayed payment. SIRA provides guidance on the process and can assist in resolving disputes. You may also seek advice from an independent legal or financial adviser familiar with CTP claims.
Time Limits and Dispute Resolution
There is no time limit for claiming interest on overdue CTP payments under the Motor Accident Injuries Act 2017. However, the right to claim interest is subject to the insurer’s obligation to pay. If the insurer has not made a payment, the claimant can pursue a claim for interest at any time, provided the claim for the underlying benefit is still valid.
If the insurer refuses to pay interest, you may apply to NCAT for a determination. NCAT has jurisdiction to review decisions made by CTP insurers, including decisions on treatment approval and payment timelines. The process is free and can be completed online or by phone.
For example, if a claimant fails to provide a valid medical certificate or a completed claim form, the insurer is not liable for interest on payments that were not properly requested.
When to Seek Independent Advice
While the CTP scheme is designed to provide timely support, delays in payment and treatment approval can occur. If you are in Bathurst and believe your insurer has failed to act within a reasonable timeframe, it is advisable to seek independent advice before taking formal action. A qualified adviser can help assess whether a delay constitutes a breach of the insurer’s legal obligations and whether interest is payable.
The treatment and rehabilitation planning process must be transparent and timely. Insurers are required to act in good faith and to make decisions based on medical evidence, not on arbitrary delays. If you are experiencing delays in receiving treatment or payments, you have a right to expect prompt action and to be compensated for any financial loss caused by the delay.
Every claim depends on its own facts. To request contact about your circumstances, complete the quick, no obligation enquiry form.