The NSW Government says it will expand its compulsory third-party insurance to cover accidents where no one is at fault after a NSW court dismissed criminal charges against a driver whose accident badly burned two toddlers.

The current scheme provides compensation for people injured in road accidents that aren’t their fault, but to receive compensation the accident must either occur in NSW or the vehicle at fault must be registered in NSW.

NSW Minister for Commerce John Della Bosca says the amendments will cover similar situations in the future, when no one is at fault and third-party insurance didn’t cover the injured.

The charges against Donald John McNeall, 69, were dropped in the Downing Centre Local Court because it could not be ruled out that Mr McNeall had suffered a seizure while driving, leading to the accident at a childcare centre in Fairlight in December 2003.

The court said Mr McNeall didn’t know he might suffer seizures or blackouts, so he wasn’t negligent.

While the parents of one injured child are pursuing civil action against Mr McNeall, the verdict in the criminal trial will make it more difficult to win a damages case against him. Mr McNeall’s insurer, NRMA, says it will continue to provide for the medical needs of the children.

NRMA Insurance CEO Rick Jackson says the priority is to help ease the burden. “As the insurer, our role has been to support the families affected by this tragic accident. We’ve been providing for the care, rehabilitation and medical needs of the children for the past 16 months, and will continue to do so.”

Mr Della Bosca says he is aware of only two cases where insurers have successfully used the defence of “inevitable accident” to avoid liability.

Insurance Council of Australia spokesman Rod Frail told Sunrise Exchange News he is waiting on more detail from the NSW Government to ascertain what will be included in a no-fault scheme.