What is CTP Insurance?


If you’ve been unlucky and been in an incident on the road it can be tricky to understand what is covered and how. CTP stands for ‘compulsory third party’ and is an insurance system in Queensland that helps those injured in an incident to receive compensation for their injuries and also helps protect at-fault drivers from financial burden. CTP insurance is part of the cost of your vehicle registration, so every vehicle is covered.


What Does it Cover?

Despite CTP insurance being compulsory and commonplace, RACQ reports that over 45% of drivers are unaware of what this insurance scheme actually covers. CTP insurance does not cover damage to the vehicle and injuries of the at-fault driver. If you’re the at-fault driver in an incident, CTP insurance protects you from financial claims and instead your CTP insurer will look after those injured in an incident including other drivers, passengers in your car and in other cars, pedestrians, motorcyclists, and cyclists. If the person you’ve injured has injuries, needs ongoing medical treatment or is unable to work, your CTP insurer will pay compensation to make sure they’re looked after. Without CTP insurance, at-fault drivers would be personally responsible for all financial costs for any injuries to another person, which many simply cannot afford. On the other hand, if you’ve been injured the at-fault driver’s CTP insurance will cover your past and future medical treatment, treatment expenses such as medication and rehabilitation, domestic assistance (if needed), past and future economic loss (including time off work), and damages for ‘pain and suffering’.


What does CTP not cover?

Unfortunately, CTP insurance does not cover the injuries of the at-fault driver. Additionally, CTP does not apply when there is a ‘blameless’ incident, for example where there has been an animal on the road causing the driver to swerve, or if a driver had a stroke behind the wheel, or if a car’s automated driving systems causes an accident and injury to others. CTP also does not cover people who are injured in non-registrable vehicles such as bicycles or skateboards.


Possible CTP Reform

The issue of CTP Insurance is currently being debated by insurance companies, legal and medical industries. While it is one of the most important social systems in Queensland, some are arguing that CTP insurance should be changed to a system similar to NSW. However, legal industry leaders are urging the Government to see the NSW reform as a warning. They argue that the new system encourages insurers to ‘rush cases through without looking properly at all the evidence’ meaning that those injured miss out on important compensation for their treatment costs and that the push for reform is merely pushing a cost-saving agenda on the behalf of insurers.


In some Australian states, CTP insurance covers all road users if they are injured in a motor vehicle accident, regardless of fault. Supporters of this scheme argue that it provides a more predictable path for compensation, removes punishment from the at-fault driver, and improves health outcomes.


Supporters of the current at-fault system believe that the current system provides a greater incentive for people to drive safely, provides greater flexibility to deal with unique claims, is able to better adapt to changing legal environments, is more fair, and allows injured persons to negotiate higher benefits. The current CTP scheme in Queensland is the cheapest and fairest scheme in Australia compared to other states. The biggest concern amongst the legal industry is that potential change to the current CTP system could reduce compensation for those injured and reduce your rights.

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