CTP insurance indemnifies vehicle owners and drivers who are legally liable for personal injury to any other party in the event of a motor vehicle accident. Your CTP insurance will cover you for personal injury caused by, through or in connection with directly driving the insured vehicle in incidents to which the Motor Vehicle (Third Party Insurance) Act 1943 applies. It will cover you for claims made against you by other road users such as drivers, passengers, pedestrians, cyclists, motorcyclists and pillion passengers.
There are three parties to CTP. The first party is the owner/driver of the vehicle 'at fault'. The second party is the CTP insurer of the vehicle 'at fault'. The third party is the injured person.
No. CTP insurance only covers personal injury to another party where a legal liability can be established.
CTP insurance is compulsory and a condition of motor vehicle licensing. If a crash occurs involving an unlicensed vehicle, the driver and owner may be financially liable for the damages paid to the injured person. In addition, owners and drivers of unlicensed vehicles face significant fines by Western Australian Police.
An injured party may claim compensation from the CTP insurer of the owner/driver of the 'at-fault' vehicle provided negligence can be established. You can still claim if you were partly at fault, but the compensation you are entitled to may be reduced. You cannot make a claim if you:
You will need to rely on sick leave, social security, Medicare and the public health system, unless you have other personal injury insurance and/or private health insurance. Motorists, particularly drivers, should consider having some form of personal insurance to cover those situations where they are the 'at fault driver' or no-one is at fault for the crash.
Yes. Unlike many other types of insurance, CTP provides unlimited indemnity to the insured. Benefits paid to the injured party depend on the extent of the injuries and can include the cost of ambulance, hospital and medical treatment, rehabilitation, loss of income and long-term care. Limits may apply with respect to loss of income (the upper limit being three times average weekly earnings per week) and limits may apply in certain circumstances to the payment of legal costs.
In setting premiums for CTP insurance each financial year, the Insurance Commission obtains independent actuarial advice relating to the risks and costs associated with each class of vehicle. The Insurance Commission also takes into account the overall financial position of the Third Party Insurance Fund, from which all personal injury claims are paid. Based upon this information, the Insurance Commission then makes recommendations for premium adjustments to its Minister for approval.
See Personal Injury Claims for more information.
In the three years following the introduction of the Goods and Services Tax (GST) on 1 July 2000 special transitional arrangements for CTP insurance prohibited GST registered motorists from claiming Input Tax Credit (ITC) on their CTP insurance premium. From 1 July 2003 however legislative changes were applied which permit most vehicle owners who are registered for GST to claim an Input Tax Credit (ITC) on their CTP insurance premium where the vehicle is used for business purposes.
The GST registered status of the insured affects the amount of the premium to be paid. A higher premium is payable for vehicles owned by GST registered motorists because CTP insurers are generally not able to claim maximum GST tax credits on claims payments made against these policies. However, most GST registered motorists are able to claim an Input Tax Credit (ITC) on their CTP policy premium.
For advice on your entitlement to claim ITC's you should contact your tax advisor.
The Standard rate is payable if you are a vehicle owner who is registered for GST. Vehicles which are not registered in the name of an individual person will only be offered the Standard rate. Similarly certain classes of vehicle (eg national heavy vehicles), will only be offered the Standard rate.
The Private rate is payable by individuals who are not registered for GST It is generally payable for vehicles that are used for social, domestic, and pleasure purposes.
The Private rate is only offered for certain classes of vehicle and only where the vehicle is registered in the name of an individual person.
If your renewal document only shows the Standard rate, renew at the standard rate.
You can access GST information: