The State Insurance Regulatory Authority is currently reviewing the provision of a legal aid type scheme for persons injured in a motor vehicle accident on or after 1 December 2017.

Currently, a person injured in a motor vehicle accident is required to bear the burden of their own legal costs and disbursements. These costs and disbursements are usually paid at the conclusion of the matter and are regulated by legislation.

This is different from the workers compensation scheme where legal representatives are funded by the Independent Review Office (IRO) (formerly WIRO). Consequently, the injured worker does not pay legal costs or disbursements associated with their matter.

SIRA has sought proposals on this consultation and various stakeholders have made submissions. For example, the Injury Compensation Committee of the Law Society has submitted that legal funding, which is available to injured workers, should also be extended to persons injured in a motor vehicle accident so that they are able to access legal services at any stage of the review process.

Alternatively, the Law Council of Australia opposes the extension of legal funding on the basis that the introduction of the scheme would “increase administration and legal fees, paid for through higher CTP policy levies, and could introduce a more complex, adversarial and drawn out process as proceedings”.

The original closing date for submissions was 2 October 2020, however consultations were extended to 2 December 2020 and extended again to July 2021.

Key takeaways
  • Currently, a person injured in a motor vehicle accident pays for their own costs and disbursements.
  • The review could lead to a scheme whereby legal costs and disbursements are funded by the state government.
  • Legal funding for persons injured in a motor vehicle accident would bring it in line with the current workers compensation funding scheme.

Written by Amy Gilford.

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