A TAC impairment benefit is a lump sum payment for a person who has permanent physical or psychiatric injuries because of a road accident. An impairment benefit is known as a ‘lump sum benefit’ and is compensation which can be paid even for single vehicle accidents, or where no-one else caused or contributed to the crash.
If you have suffered injuries from which you do not fully recover, you may be able to make a claim for an impairment benefit.
How is my impairment assessed?
All of your permanent injuries (including psychological injuries) from the transport accident can be assessed as part of your impairment benefit claim.
Your injuries will need to be assessed by independent medical experts according to a set of impairment guides called the AMA Guides. These guides provide a score or rating for each injury based on a level of “whole person impairment”.
This assessment is completed by independent medico legal experts trained and qualified to use the guides to evaluate impairment. Treating health practitioners (for example, your own treating GP) in most circumstances, are not qualified to perform the assessments.
Will I be entitled to an impairment benefit/lump sum payment?
If your impairment from all injuries is greater than 10% whole person impairment, you will be entitled to receive a lump sum payment of compensation.
This assessment does not take into consideration your pain and suffering or economic loss (these are taken into account in a negligence or “common law claim” for compensation).
Once all the assessments have been received, your lawyer carefully reviews the reports, and makes a proposal to the TAC for the best available benefit to you based on the medical evidence.
The TAC then makes a proposal, and your lawyer advises you whether you should accept this proposal, whether you should seek a higher determination, or whether more medical material is needed.
How much can I receive?
As of January 2021, for an impairment rating of 11% you will receive $8,040. An additional amount will be paid for every 1% point of impairment greater than 11%.
For example, if you receive an impairment rating of 13% you will receive $11,020.
A 100% impairment currently entitles a person to $366,900.
The amounts payable go up each year.
Example impairment assessment
Sarah is injured in a car accident in which she is struck on the right side of her body.
After treatment, it is necessary for Sarah to have a hip replacement. Thankfully Sarah recovers well from her hip replacement surgery but she is left with surgical scarring as a result of the operation.
Sarah often has accident-related dreams and flashbacks. She avoids the scene of the accident.
Sarah’s impairment could be assessed by the doctors in the following way:
- Hip replacement = 15%
- Scarring = 3%
- Psychological impact = 4%
A formula is used to combine the total impairment score.
In Sarah’s case, this will result in a lump sum compensation payment of $24,010.
If you think that this doesn’t sound like enough compensation for what Sarah has been through – you’d be right.
It is important to remember that this impairment benefit does not affect Sarah’s other TAC entitlements, which can include:
- ongoing payment of medical and other supports;
- payments for loss of income; and
- a claim for compensation for negligence, entitling her to be compensated for pain and suffering and future loss of earning capacity (which in her case is likely to be over $300,000).
When can I apply for an impairment benefit?
The TAC can assess your level of permanent impairment as soon as 3 months after your accident.
In situations where your injuries have not stabilised, the TAC can make a part payment of your impairment benefit while your injuries continue to heal.
The TAC is obliged to determine your level of impairment within 3 years of the date of the accident, however, you may ask the TAC to delay its assessment of your level of impairment beyond this date until your injuries have completely stabilised.
What does it mean for my injuries to be stabilised?
An injury is considered stable if it is unlikely to get significantly better or worse in the foreseeable future.
How long does an impairment benefit claim take?
Generally, your claim will take between 12-18 months from the time you consult with your solicitor. This can depend on the nature of your injuries and treatment, and the availability of independent medico-legal specialists.
What do I need to do during my impairment benefit claim?
You should continue to seek treatment for your injuries. Stopping or delaying your treatment is unlikely to help with your claim or your recovery.
You should regularly tell your doctor about your symptoms and restrictions.
Keep your lawyer updated about any changes in your condition or treatment, including any new doctors you consult.
Finally, you need to attend all independent medico-legal appointments arranged by your lawyer. If you are late or do not attend a medico-legal appointment, your claim can be delayed by several months.
Who will pay for the medical reports and independent medico-legal reports?
In most circumstances, the TAC will pay for reports from your treating doctors.
The TAC will also pay for medicolegal assessments arranged by your lawyer (using a process called a “Joint Medical Exam” or a “JME”). The TAC can also pay for your travel to and from Joint Medical Examinations.
Will an impairment benefit affect my Centrelink benefits? Will the benefit be taxed?
An impairment benefit is not usually regarded as ‘income’ and should not be taxed. For the same reason, payment of an impairment benefit will not usually affect your Centrelink payments (although it can be considered an “asset” which can affect the Centrelink assets test).
You can learn more about this in our article “Your TAC claim and Centrelink entitlements”.
Will there be costs payable by me if I receive an impairment benefit?
If you receive an impairment benefit, the TAC will be required to pay for some of the legal costs and you will be required to pay the “gap” between the total fees and the amount the TAC has paid. This gap should never outweigh your impairment benefit.
If you’ve been injured (physical and/or psychological injuries) in a road accident in Victoria and you suffer permanent injuries, you should investigate any entitlement to a lump sum payment of compensation called a TAC impairment benefit.
Although there are thresholds which need to be met (notably, the percentage of your whole person impairment), calculation of these can be tricky. It’s important to consider all the specific and separate injuries (no matter how minor) you sustained in the accident to ensure your impairment assessment is accurate.
At Polaris, we have the knowledge and experience to ensure all your entitlements (not just the obvious ones) are thoroughly assessed and claimed.