SA’s compulsory third party (CTP) insurance scheme is under review, with the State Government saying it’s not cost-effective and most of its resources are spent on minor claims.

The scheme is fault-based and therefore does not cover all people involved in motor accidents. Compensation is only available to those who prove their injury was wholly or partly someone else’s fault.

A government green paper into the scheme says SA’s CTP system is among the “more expensive of its type in Australia”, with premiums set to increase by 5% a year if no change is made.

The review follows a major Productivity Commission report recommending a no-fault national injury insurance scheme for catastrophic injuries, describing no-fault arrangements as “superior” to fault-based schemes.

It found such schemes are likely to be more efficient and provide better care for injured people.

The federal and state governments have agreed to work together on the recommendations.

The SA Government says that if a full no-fault scheme is put in place, insurance premiums will fall by $30-$40 a year.

Such a scheme would cover all accidents and provide lower payouts for less serious injuries.

The green paper says no-fault schemes “tend to provide support or payments until they are no longer required”, unlike the lump sum payment of fault-based schemes.

The Law Society of South Australia and the SA Bar Association say in their submissions to the review that there is no evidence the current scheme isn’t operating effectively.

Other submissions say that only minimal support should be provided to those who drive recklessly or under the influence of alcohol.