The following impairment policy applies for accidents between 1 September 2003 and 15 December 2004.
When is a client assessed for impairment benefits?
- An impairment determination cannot be made:
- until 3 months elapse from the date of the accident; and
- the injuries are stable
- If the TAC believes a client is likely to be entitled to an impairment benefit, the assessment may be done 3 months after the accident and within 3 years of the accident, depending on the date the injuries stabilise. Also refer to Guideline question, "When are injuries considered to be stable, not stable or substantially stable?"
- A "minor" may be assessed, after 3 months have elapsed from the date of the accident:
- if the injuries are stable, at the age of 18; or
- if the injuries are not stable, when the injuries stabilise after the age of 18, but no later than a client turning 21
What if the client's injuries are not stable 3 years after the accident?
If after 3 years, the injuries are not-stable a client who is not a minor at the date of the accident may ask the TAC:
- to wait until the injuries stabilise before an assessment is done; or
- to be assessed, agreeing to accept the current (not-stable) impairment assessment as their final impairment determination.
Where a client has chosen to have their current impairment determined, the TAC has 12 months from the date of the written request in which to make a determination. Where a client has not advised the TAC of their choice within 90 days (of the 3 year mark), the TAC will determine the client's impairment within 12 months, (of the 90 day mark).
What if a client applies for an impairment determination in writing, more than 2 years after the accident?
Where a client applies to the TAC for a determination of impairment more than 2 years after the accident or after the injury first manifests itself, and the injury is stable at that time, the TAC must determine the client's degree of impairment within 12 months of a client's application. If the injury was not stable when the client applied, the TAC must determine the client's degree of impairment within 12 months after the injury stabilises or 2 years after the application, whichever first occurs.
How is the lump-sum benefit calculated?
Once a client's impairment has been determined at 11% or more they are entitled to receive a lump-sum benefit which is calculated in accordance with the applicable formula under section 47of the TAA (1986). This example illustrates how a lump-sum benefit is calculated.
A client's permanent impairment is determined at 20%. Therefore the client's lump-sum entitlement would be assessed as follows:
|20%-10% x $113,380.00 (1 July 2019) = $12,597.78 lump-sum payable|
Is a client entitled to annuity benefits?
Yes. A client who has an impairment of 11% or more is entitled to weekly annuity benefits under section 48 of the TAA (1986). The weekly annuity benefit is compensation payable to a client who is not in receipt of loss of earning capacity benefits.
How long are annuity benefits payable and when do they cease?
Weekly annuity benefits are payable from the date the impairment is determined:
- until 3 years expires from the date of the accident or for 78 weeks, whichever is the greater, (applies where the impairment is less than 50%); or
- until the client reaches the age of 75, (where the impairment is 50% or more); or
- until a claim for common law damages settles.
Note, weekly annuity benefits are not payable for any period that Loss of Earning Capacity benefits (LOEC) are paid.
Also refer to the policies for loss of earnings capacity benefits and the repayment of benefits - common law.
Are annuity benefits subject to review?
Yes, reviews are conducted on claims where the impairment is determined at 50% or more. The TAC reviews a client's entitlement to weekly annuity benefits once in every five year period or at any time if the client requests a review. The first review may take place after the first 18 months that a client starts receiving weekly annuity benefits.
How is the review conducted?
In conducting the review, the TAC uses the Guides to the Evaluation of Permanent Impairment, second or fourth edition, depending on when the accident had occurred. The same edition of the Guides that was used in determining a client's initial degree of impairment will be used in determining the client's degree of impairment for the purposes of the review.
What will happen after the review is completed?
The TAC will increase, decrease, cease or maintain a client's weekly annuity benefits once the review is completed. The client will receive a letter from the TAC advising of this.
What is an interim payment?
This is an advance payment in relation to a client's injuries, which may result in a permanent impairment of 11% or more. The degree of impairment used to calculate the interim payment does not determine a client's entitlement to Loss of Earnings Capacity benefits, annuity benefits or access to common law damages as it is not an impairment determination.
When is an interim lump-sum payable?
The following policy applies from 16 December 2004.
- An interim payment is not payable, if a client has been or may be charged with a relevant offence in relation to the accident. Refer to the guidelines, "drivers who are convicted and drivers with charges pending".
- An interim payment may be paid at any time after the accident and usually this may occur at 3 months after the accident, if the TAC is satisfied that:
- the client's permanent impairment is likely to be at least 30% ; or
- the injuries are stable or substantially stable and the permanent impairment is likely to be 11% or more.
In either circumstance, the payment to be made is based on a degree of impairment of at least 11%.
- The interim impairment will be deducted from the final impairment when it is determined.
- Where an overpayment occurs because the final impairment is below the interim impairment, the TAC will not recover any overpayment from a client.
Are annuity benefits payable when an interim lump-sum is paid?
No, weekly annuity benefits are not payable. Weekly annuity benefits become payable once the final impairment is determined.
Will the TAC redeem annuity payments?
Yes, the TAC may pay out a client's future entitlement to annuity benefits in advance if the periodic payment falls below 5% of the Victorian Average Weekly Earnings (AWE). The practice of paying a single lump-sum payment in lieu of future weekly payments is known as redeeming. The formula which calculates the amount of the redemption is found in the Transport Accident (Impairment) Regulations 2010. A client who has their weekly annuity payments redeemed under this formula is not entitled to claim LOEC payments. The TAC therefore can only redeem a client's annuity where evidence indicates there is no likelihood that loss of earning capacity benefits are or will be payable.
What payment options are available?
Under the Act, a client may elect to receive the impairment benefit as:
- one lump-sum; or
- a combination of a lump-sum and the remainder as weekly payments. These options are not available for interim lump-sums.