Children in NSW will be disadvantaged by changes to compulsory third-party (CTP) motor vehicle insurance, according to the Labor Party.

New legislation will put a five-year cap on the payment of medical costs to people with up to 10% total impairment, causing problems for children who may need to delay surgery until adulthood, Shadow Treasurer Michael Daley says.

“Sometimes they have to wait until they have stopped growing before an assessment can be made of the injury,” he told insuranceNEWS.com.au.

The legislation also fails to adequately provide for children’s loss of future earnings, he says.

The NSW Government is introducing no-fault payments to the CTP scheme to improve costs and efficiency and ensure payments are not delayed by legal battles.

The 10% impairment threshold for medical payments to continue after five years is too high and will leave people underinsured, Mr Daley says.

“There are a range of injuries that won’t get you near 10% that you will suffer from for your entire life.

“If you want to ensure your capability to look after your family… you will have to get income protection insurance.”

A spokesman for Finance and Services Minister Greg Pearce says the scheme ensures children’s care expenses are paid early, when treatment is most effective.

Injuries can be reviewed after five years and if they have not stabilised and it is likely a permanent impairment will exceed 10%, they will remain eligible for care until a final assessment, the Government says.

The Government has amended the bill, which passed the lower house last week, to ensure young people working before an accident receive benefits for loss of earning capacity.