The NSW State Insurance Regulatory Authority (SIRA) says an external review of the compulsory third party (CTP) scheme has found the regime is meeting its overall objectives since its introduction in 2017.

But there is still room for improvement, according to the statutory review of the Motor Accident Injuries Act 2017 conducted by Clayton Utz and Deloitte.

The reviewers made 73 recommendations in the 338-page report in relation to the scheme’s design, scheme interpretation and key performance indicators.

Of the 73 recommendations, 10 are deemed priorities, including proposals for an independent claim file review, review of types of claims suitable for internal review, and resolving delays in disputes.

Another priority area is a recommendation for a thorough investigation into the extent and nature of fraud. Such an investigation will then form the basis of accountabilities, roles and responsibilities in respect of fraud deterrence across all scheme participants.

The report says that when it comes to deterring fraud in connection with CTP insurance, the scheme in its present state is not in a position to achieve the objective.

“There is a lack of overall fraud detection and prosecution in the scheme, and visibility of this,” the report said.

“There does not appear to be any published decisions available with regard to cases implementing the penalties and remedies available pursuant to [the Motor Accident Injuries Act 2017].

“These penalties and remedies are not being utilised, or at least visibly utilised, which may result in an increase in fraudulent or false and misleading claims.”

The report however notes SIRA is proactively seeking to enhance its fraud prevention and deterrence capabilities via a data analytics solution, which Deloitte is supportive of.

Other key recommendations include extending statutory benefits for minor injuries and at-fault drivers from 26 weeks to 52 weeks, that SIRA consult on the term “minor injury”, and removing the 20-month waiting period to lodge a damages claim and the two-year waiting period before a damages claim can be settled.

The report says the scheme is currently at a stage where a range of important issues associated with its framework are apparent and should be addressed.

“However, the operation of some aspects of the Scheme has not yet been fully tested, or tested at all,” the report said. “The scheme is critically important to the users of roads in [NSW] and is in its early stage of maturing.

“It should remain under review to make sure that it is working to achieve the objectives of the Act.”

The report recommends that the Act be amended to provide for future, periodic reviews at intervals of not more than five years.

The current review of the scheme, a requirement included in the Act, commenced in May this year.

“The short timeline did not allow time to consider in detail all of the issues raised by stakeholders, nor any opportunity to consult on proposals for amendments to the Act, Regulations or Guidelines,” the report said.

“Future reviews would benefit from a less compressed timeline.”

Click here for the report.