A threshold injury under the Motor Accident Injuries Act 2017 (NSW) includes a soft tissue injury and a psychological or psychiatric injury that is not a recognised psychiatric illness (adjustment disorder and acute stress disorder are the usual examples; s 1.6 and Motor Accident Guidelines Part 5).
Motor accident claims in New South Wales are governed by the Motor Accident Injuries Act 2017, which sets out how insurers assess liability for statutory benefits. Insurers do not determine liability in the same way as a court would in a common law damages claim. Instead, they assess whether the motor accident occurred, whether the claimant was injured as a result, and whether the injury falls within the statutory framework for compensation. This assessment is made under the Act’s provisions, which prioritise prompt access to treatment and care benefits, weekly income payments, and, where applicable, damages for non-economic loss. The process is not based on fault in the traditional sense, but on whether the injury was caused by a motor vehicle accident and whether the claimant meets the eligibility criteria under the Act.
The Motor Accident Injuries Act 2017 establishes a framework for statutory benefits that are available regardless of fault, provided the claimant was injured in a motor accident involving a motor vehicle. Insurers assess liability by verifying the occurrence of the accident, the nature and extent of the injury, and whether the claimant is eligible for benefits under the Act. This includes confirming that the claimant was a driver, passenger, pedestrian, cyclist, or motorcyclist at the time of the accident, and that the vehicle involved was registered in NSW or operated in NSW. The insurer will also confirm whether the claimant was injured during a motor vehicle accident as defined by the Act, including incidents on private property, in car parks, or on roads, provided the vehicle was being used in a way that falls within the legal definition of a motor vehicle accident.
Insurers rely on several key sources to assess liability. These include the claimant’s medical records, which must show a causal link between the accident and the injury. The Motor Accident Injuries Regulation 2017 and the Motor Accident Injuries Guidelines set out the criteria for determining whether an injury qualifies as a threshold injury, which affects eligibility for damages. Insurers will review the claimant’s treatment and care records, including reports from medical practitioners, to assess the nature and duration of the injury. They will also consider any police reports, accident scene photographs, witness statements, and correspondence with the insurer. The claimant’s employment and income records may be reviewed to determine eligibility for weekly income payments, particularly if they are unable to work due to the injury.
A claimant must notify their insurer within 60 days of the accident to preserve their rights under the Act. While the 60-day period is not a strict deadline for all benefits, it is critical for accessing treatment and care benefits and for preserving the right to claim damages. Failure to notify within this timeframe may affect the insurer’s ability to process the claim. Insurers are required to make a decision on a claim within 21 days of receiving all necessary information, unless an extension is granted. If a claim is denied, the claimant may request a review under the Motor Accident Injuries Act 2017, or apply to the NSW Civil and Administrative Tribunal (NCAT) for a determination.
The Act provides for three main types of benefits: treatment and care benefits, weekly income payments, and damages for non-economic loss. Treatment and care benefits cover medical treatment, rehabilitation, and support services. Weekly income payments are available if the claimant is unable to work due to the injury and were earning income prior to the accident. Damages for non-economic loss are only available if the claimant has a threshold injury, which includes injuries such as a spinal nerve-root injury with neurological signs, or a permanent impairment of at least 10% of the whole person. The claimant must also have been injured in a motor accident involving a motor vehicle, and the injury must not have been caused by a pre-existing condition or a separate incident.
A hypothetical example: A pedestrian was struck by a car in a car park in Sydney on 15 March 2024. The claimant was treated for a neck injury and diagnosed with a spinal nerve-root injury showing neurological signs, but not radiculopathy. The claimant submitted medical reports, a police report, and a witness statement. The insurer assessed the claim under the Motor Accident Injuries Act 2017 and determined that the injury met the threshold criteria under the Motor Accident Injuries Guidelines. The claimant was therefore eligible for treatment and care benefits, weekly income payments, and damages for non-economic loss.
Insurers must act in good faith and follow the procedures set out in the Act. If a claimant believes their claim has been assessed unfairly, they may seek independent advice from a legal practitioner or contact SIRA for guidance. The insurer’s decision may be reviewed internally, or the claimant may apply to NCAT for a determination. The claimant should retain all documentation related to the accident, treatment, and correspondence with the insurer.
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