PTSD and Motor Accident Claims in NSW
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).
If you have experienced a serious road accident in Greater Sydney and are now dealing with post-traumatic stress disorder (PTSD), you may be asking whether you can claim compensation under the NSW Compulsory Third Party (CTP) insurance scheme. The short answer is yes, PTSD resulting from a motor accident may be compensable under the Motor Accident Injuries Act 2017 (MAIA), provided it meets legal criteria and is supported by medical evidence. This is not limited to physical injuries; psychological harm caused by a motor accident can form the basis of a claim for treatment and care benefits, weekly income payments, and in some cases, damages.
How SIRA Handles PTSD Claims Under NSW CTP Law
The State Insurance Regulatory Authority (SIRA) administers the CTP scheme in NSW. Under the MAIA, a person who suffers a psychological injury as a result of a motor accident may be entitled to benefits, including treatment and care, and in certain circumstances, damages. The key legal principle is that the PTSD must be directly caused by the accident, not by pre-existing conditions or unrelated events.
SIRA’s guidelines state that psychological injuries such as PTSD must be clinically diagnosed by a qualified mental health professional. The injury must also be significant and not merely transient or minor. The Motor Accident Injuries Regulation 2017 and the Motor Accident Guidelines set out the standards for assessing psychological injuries, including the need for objective clinical evidence, such as a formal psychiatric assessment, treatment records, and a documented impact on daily functioning.
Legal Boundaries for PTSD Claims in NSW CTP
There are important legal limits on what can be claimed for PTSD. First, the injury must not be classified as a 'threshold injury' under the MAIA. Threshold injuries include certain soft-tissue injuries, but PTSD is not categorised as a threshold injury. This means that if PTSD is the only injury, or the primary injury, it does not fall under the 52-week cap on treatment and care benefits that applies to threshold injuries only.
However, if a person has both PTSD and a threshold injury (such as a whiplash injury), the 52-week limit on treatment and care benefits may apply to the threshold injury, but not to the PTSD. The law allows for separate consideration of psychological injuries, which can result in ongoing treatment and care benefits if clinically necessary.
Damages for PTSD are only available if the injury meets the 'serious injury' threshold under the MAIA. This requires a whole person impairment (WPI) of at least 10%. A WPI is assessed by an independent medical practitioner using the Australian Medical Association’s impairment rating guidelines. If PTSD results in a WPI of 10% or more, and it is shown to be caused by the accident, a claim for damages may be made.
Practical Steps and Evidence That Matter
To support a PTSD claim under CTP, you should take the following steps as soon as possible:
- Seek medical assessment from a registered psychologist or psychiatrist experienced in trauma and motor accident injuries. A formal diagnosis and treatment plan are essential.
- Keep detailed records of your symptoms, including sleep disruption, flashbacks, anxiety, avoidance behaviours, and any impact on work or relationships.
- Preserve any accident-related evidence: police reports, photographs of the scene, witness contact details, and vehicle damage records.
- Notify the CTP insurer of your claim within the applicable time limits. While there is no fixed deadline for notifying a claim, delays may affect the insurer’s ability to investigate and assess your case.
- Maintain a daily journal of how your PTSD affects your daily life, including any inability to work, attend appointments, or perform household tasks.
SIRA notes that insurers are required to assess claims fairly and in good faith. If your claim is denied or delayed, you may request a review or seek independent advice.
Time Limits, Disputes and When to Seek Advice
There is no strict time limit for making a CTP claim for PTSD in NSW, but it is strongly advisable to act promptly. Delays may make it harder to obtain evidence, particularly from witnesses or to reconstruct the accident. The statutory time limit for commencing proceedings in the NSW Supreme Court for damages is three years from the date of the accident, but this does not apply to claims for treatment and care benefits or weekly income payments.
If your claim is rejected or you believe the offered compensation is inadequate, you may dispute the decision. SIRA provides a formal dispute resolution process, and you may also seek assistance from an independent legal practitioner or a community legal centre.
A common concern among people in Greater Sydney is whether they need to prove fault. Under the CTP scheme, fault is not required to access treatment and care benefits or weekly payments. However, to claim damages, you must demonstrate that the accident was caused by another party’s negligence, or that you were not at fault in a blameless accident.
Hypothetical Example: A Case from Greater Sydney
A 38-year-old driver in Sydney’s western suburbs was involved in a high-speed collision at a roundabout in June 2025. The impact caused severe psychological distress. Over the next 12 months, the driver developed symptoms of PTSD, including recurring nightmares, panic attacks, and an inability to drive. A psychiatrist confirmed a diagnosis of PTSD and assessed a WPI of 15%. The driver submitted medical reports, a treatment plan, and accident documentation to their CTP insurer. The insurer approved treatment and care benefits and a claim for damages was subsequently made. The case was resolved through settlement after review.
Next Steps
Every claim depends on its own facts. To request contact about your circumstances, complete the quick, no obligation enquiry form.