This article was updated July 2023
In Victoria, almost all claims for personal injury compensation are subject to “caps” and “thresholds” under the law. These limit the amount of compensation you can receive if you are injured or if you lose a loved one because of someone else’s fault.
While “caps” act as ceilings or limits on the amount of compensation you can receive, “thresholds” are the minimum required in order for you to be entitled to compensation.
This means that if you were injured in Victoria, the amount of compensation you can receive is likely to be capped or subject to a threshold, and will depend on how you were injured and the type of compensation claim which you are making.
Each year, these caps and thresholds change and generally go up on 1 July.
The effect of these thresholds and caps on damages is that if the amount of compensation awarded is above the cap, or below the threshold, a Court will adjust the amount payable to you.
On 1 July 2023, there was an increase to the maximum amounts of compensation payable in Victoria for people injured at work, in motor vehicle accidents, in public places and as a result of medical treatment.
These figures are commonly referred to as the stat max, or statutory maximum.
What are the current thresholds and caps?
As at July 2023, the caps and thresholds are as follows:
Workers’ compensation common law claims:
Pain and suffering – minimum threshold $70,320 and maximum $713,780
Economic loss – minimum threshold $72,820 and maximum $1,639,480
Transport accidents common law claims:
Minimum threshold – $63,880
Pain and suffering maximum – $639,200
Economic loss maximum – $1,438,310
(Note: different caps and benefits apply in the case of a death as a result of a motor vehicle accident).
Public liability claims:
Pain and suffering maximum – $713,780
Economic loss maximum –$3,991.80 per week
Medical negligence claims:
Pain and suffering maximum – $713,780
Pecuniary loss maximum – $3,991.80 per week
Are there exceptions to caps and thresholds?
It is important to note that in very specific cases, such as cases involving exposure to asbestos, these caps and thresholds do not apply.
Recent examples of compensation payouts
Awarded $1,000,000 compensation but reduced to the maximum
A woman suffered total loss of vision to her left eye when it was pierced by a stick from a pot plant while she was dancing.
The jury awarded $1,000,000.00 for pain and suffering, however, because of the cap on damages in Victoria, the compensation was reduced to the statutory maximum under the Wrongs Act.
Awarded $598,360 compensation (maximum at the time)
A worker suffered severe back, shoulder, pelvic and psychiatric injuries when eight gates in the rear of a trailer fell on him. He was hospitalised multiple times and underwent 7 rounds of orthopaedic surgery. He continued to require heavy medication for pain and psychological injuries.
A court heard that the injuries had had a devastating impact on the worker and his family. A court awarded him $598,360.00, which at that time was the maximum according to the law applying to workers compensation claims in Victoria.
Awarded $50,000 but reduced to nil
A 47-year-old woman suffered an injury while working as a personal care attendant, attempting to transfer a person from a wheelchair to a bed. She claimed to suffer neck and right shoulder injuries as a result of the incident.
The evidence showed that parts of the worker’s evidence were unreliable and suggested that the incident was not a cause of all of her injuries.
A jury awarded $50,000, which was reduced to nil because the amount was below the minimum threshold according to the law applying to workers compensation common law claims.
Awarded $300,000 compensation
A 49-year-old pedestrian suffered injuries to his neck and to his back (which required surgery) after falling 4.5m from scaffolding.
A court awarded $300,000 for his pain and suffering.
A young man sustained a severe knee injury when he collided with a fence while playing football. The fence was found to be too close to the playing surface. As a result of the injury, he was likely to need a knee replacement.
A court awarded him $375,000 for pain and suffering damages.
Awarded $250,000 compensation
An airport security worker was 26 years of age when she injured her knee while attempting to move heavy luggage. She developed severe arthritis in her knee. Treatment and medication did not alleviate her ongoing knee symptoms.
Pain and suffering damages were assessed by a Court at $250,000.