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Does the new CTP scheme regulate legal costs adequately?

by | 29 Oct 2018 | All, CTP insurance, Legislation

At Prudence OT, industry changes such as the new CTP scheme we reported on previously implicate the importance of remaining up-to-date. Now we turn to the role of the solicitor in place of this new scheme.

Of vital significance in this new scheme is the date of accident (DOA). The DOA is important for the solicitor in determining which rights their client, ‘the injured person’, has in relation to making a new claim. If the DOA has happened on or after the 1st of December 2017, the claimant has rights under the Motor Accidents Injuries Act 2017 (i.e., the new CTP scheme).

Under these new CTP changes that have attempted to ensure that a more streamlined claims process is in place — it is important that solicitors engage in a fair and timely resolution of claims. This will allow implementation of appropriate measures (e.g., providing the necessary support to the injured person) and reduce unnecessary delays and disputes.

According the State Insurance Regulatory authority (SIRA) solicitors are required to be aware of their responsibilities regarding:

  • Claims Cost Disclosure — It is necessary for the solicitor who is representing the injured party to provide SIRA with a breakdown of costs. This breakdown must include:
    1. total amount the claim resolved for;
    2. deductions (e.g., legal costs) and payback pertaining to the claim;
    3. the total amount paid to the claimant (i.e., the injured party).
  • Disputes and Review — Arranging an authorised health practitioner to provide an assessment. Prudence OT is able to organise these assessments and has a team of industry leading personal injury specialists to provide these reports.

It is important that solicitors understand fees are calculated according to the status of the claim. In sum, statutory benefits (e.g., weekly income payments) can be claimed by the injured party for up to 26 weeks, except in certain exceptions (e.g., if the injured person has committed a serious driving offence).

In terms of legal fees for statutory benefits, they are unable to be claimed for some dispute types. Contrastingly, legal costs pertaining to claims for damages is capped. A major change is the clause for Regulated Costs which means that if a claim settles for $75,000 or less the legal professional is only entitled to claim for regulated costs and is not allowed to contract out. Another significant change concerns age with a clause abiding that for those aged under 18 years of age, legal costs are limited to $15 000.

For further information pertaining to costs and fees, Part 8 of the Act deals with this matter.

At Prudence OT, we aim to provide cost effective and trusted reports for an array of dispute types. This is achieved through consistently ensuring our prices are competitive and that assessments are conducted by highly trusted personal injury specialists.

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