CTP (Compulsory Third Party) Insurance and Green Slips Explained
Compulsory third party insurance, also known as CTP or Greenslip insurance, is
liability insurance that covers injuries or death of another person while
you are driving. If you are legally liable for someone else’s injuries
from a vehicle accident, CTP will take care of their personal injury
claim.
Green slip insurance is important because it protects other people that
you might harm, whether the accident is caused by your distraction,
falling asleep behind the wheel, or recklessness. It also protects
you, as the driver or owner of the vehicle, because it keeps you from
paying personal injury claim money from your own pocket. In addition
to this type of cover being a good idea, in two states having this
policy is the law.
Who needs CTP insurance / green slips?
By law, drivers in New South Wales and Queensland are required to
obtain compulsory third party insurance (hence the “compulsory” part
of the name). You must get a CTP policy / green slip in order to register or re-register
a vehicle.
Only six insurance companies are qualified to offer CTP and green slips in Queensland
(RACQ, NRMA, Allianz, AAMI, Suncorp and QBE) and seven are authorized
to offer CTP insurance and greenslips in New South Wales (Zurich, QBE, NRMA, GIO,
CIC Allianz, Allianz, and AAMI).
What typically does a CTP policy / green slip cover?
Compulsory third party comes into play when you are at fault in a
vehicle accident, whether as the driver or as the owner of the car.
CTP will cover injuries and death for:
- Anyone riding in the vehicle with you
- Anyone else involved in the accident, from drivers and passengers
of other vehicles to pedestrians
- Anyone injured by a trailer you may be towing at the time of the
accident
As of October 1, 2006, a new benefit was incorporated into new or
renewed CTP policies for drivers in New South Wales. This benefit
is called the Lifetime Care and Support Scheme (LTCS), and it is designed
to cover any child—age 16 or younger—that is seriously injured in
a vehicle accident, whether you are at fault or not. The idea is to
make sure an injured child has all the medical care they need no matter
who caused the accident. If the child suffers a life-long injury,
such as needing a wheelchair or other lifetime care, this new benefit
will take care of their medical needs and support for the remainder
of their life.
What typically does a CTP policy / green slip not cover?
If you are at fault in the accident, CTP will not cover your personal
injuries. It also does not cover damage you might cause to other vehicles
or property.
Additional insurance products that green slip policy holders might need
in this area
Carrying a third party property damage policy is a very good idea.
This policy will take care of claims if your vehicle damages property
or another vehicle in an accident. Even if your car is a hunk of junk
that isn’t worth carrying a comprehensive policy on, you’ll want to
carry protection for third party damage. Otherwise, you’ll find yourself
paying for the other driver’s fender on your own. This type of policy
often covers fire and theft damage to your vehicle as well.
Additional coverage for a CTP policy / green slip
While additional cover options are not offered in the CTP policy,
many people bundle their CTP with comprehensive car insurance from
the same company to get a discount on premiums.
What will CTP (greenslip) insurance typically cost?
Many things determine how much you will pay for your green slip, such
as your driving record, your age, the type of vehicle and its age/condition,
and the zone where your car is garaged. Different postal codes carry
different premiums for CTP insurance because the risk assessment is
different for each area. For example, drivers garaging their vehicle
in downtown Sydney may pay a higher premium than those living beyond
city limits. The Motor Accidents Authority (MAA) is responsible for
assessing the motor vehicle accidents and risk in each postal code.
There are many ways you can save money on your greenslip, as prices
can vary drastically between the few companies that offer CTP policies.
Business fleets of more than five cars often qualify for discounts
on CTP premiums.
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