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Motor vehicle accidents

Motor vehicle accidents are an unfortunate but common occurrence. This topic provides practical, legal information explaining what to do after an accident and the process for claiming for personal injury and property damage.

Legal obligations after a motor vehicle accident

The driver of every vehicle involved in an accident must:

  • Stop at the scene of the accident
  • Give their details including their name and address, the name and address of the vehicle’s owner, and the vehicle's registration number (or any other information necessary to identify the vehicle) to any other driver involved, any person injured (or their representative) or the owner of any property that has been damaged.

[Australian Road Rules reg 287(2)]

If any of the following circumstances apply, the driver must also report these details to police as soon as possible within 24 hours [reg 287(3)]:

  • If anyone is injured or killed in the accident
  • If you have not given your details to each person as above
  • If you have not been given the details of the other driver
  • If a vehicle is towed or carried away by another vehicle
  • If a fair estimate of the cost of repairing damage to property (other than to your own vehicle or property) is $3000 or more [see Road Traffic (Road Rules- Anciliary and Miscellaneous Provisions) Regulations 2014 (SA) reg 39, 40, 41 and 42]

Therefore if you have a minor accident where both drivers exchange details, no one is injured and the cost of repairing damage to the other vehicle or property is likely to be less than $3000, then there is no legal obligation upon you to report it to police. However, even though you may not be obligated to report, it is good practice to do so anyway. This is because insurers often ask drivers for a police report number. To deal with the large numbers of such reports, SAPOL now has an Online Collision Reporting System to allow drivers to report crashes where there is no legal obligation to do so (ie no one is injured and the cost of repairing damage to the other property is likely to be less than $3000). When assessing the likely cost of repairing damage that has been caused, this includes damage to other property (such as a fence) as well as the other vehicle(s) involved.

Additional obligations where accident causes injury or death

If someone is injured or killed then the driver of every vehicle involved in an accident must:

  • stop immediately at the scene of the accident
  • immediately give all possible assistance
  • within 90 minutes of the accident, present themselves to a police officer to give particulars of the accident and submit to any test for alcohol or drugs

[Road Traffic Act 1961 (SA) s 43]

As soon as practicable after an accident involving injury or death, contact the approved CTP insurer of the vehicle. As of 1 July 2016 there are four insurance companies providing CTP insurance in South Australia (AAMI, Allianz, QBE and SGIC). They will send forms which must be filled in and returned. Allocation of an approved insurer is automatic for all registered vehicles in South Australia. If you do not know the name of your allocated CTP insurer you can contact the Compulsory Third Party regulator (1300 303 558).

It is an offence not to provide written notice of the accident to the insurer. The penalty for this offence is a fine of up to $1 250, or imprisonment for up to 3 months [see Motor Vehicles Act 1959 (SA) s 124].

For further details about the offences that may be committed when a person fails to comply with these and other duties, see CRIMINAL AND TRAFFIC OFFENCES - Traffic Offences -Driving Offences -Offences and Duties after Accidents.

Practical steps

As well as the legal obligations after an accident, a driver involved in an accident should take the following steps:

  • As well as obtaining the name, address and registration number of any other driver involved, also ask for their telephone number.
  • Ask anyone who was a witness to the accident for their name, address and telephone number.
  • Do not argue about whose fault it was.
  • Do not admit that the accident was your fault.
  • If possible, make a sketch of what happened and put on the sketch plan any measurements (such as length of skid marks, distance of the vehicle from the kerb, etc).
  • Make notes about any damage to the vehicles.
  • If possible, take photographs of the damage and the scene of the accident.
  • If you are insured for damage to your own vehicle and/or Third Party Property damage, you should notify your insurance company without delay. Even if you don't intend to make a claim on your insurance company, let them know you have been involved in a crash. Simply letting the insurance company know about the accident will not affect your no claim bonus.

Claiming Compensation

When claiming compensation, it is necessary to prove that the other person was negligent. That is, any damage or injury was caused wholly or in part by lack of reasonable care by that other person in the driving, control or maintenance of her or his vehicle. It is important to realise that an injured party must be able to establish someone else was negligent. Simply being injured in an accident does not automatically result in an injured party being compensated.

Types of loss and time limits

In a motor vehicle accident, two kinds of damage (loss) may be suffered. These are:

  • personal injury, for example cuts, bruises, broken bones, shock, death
  • property damage, for example damage to cars, motor cycles, clothing, luggage.

In recovering compensation for these damages different insurance policies often apply and it is advisable to handle each claim separately. While the extent of personal injuries may be unclear for some time, the cost of repair of a vehicle is usually apparent immediately and the owner will want the vehicle back as soon as possible.

In both cases it is important to realise that there is a limited time in which to commence legal action. In the case of personal injury the time limit is three years [see Limitation of Actions Act 1936 (SA) s 36] and in the case of property damage the time limit is six years [see Limitation of Actions Act 1936 (SA) s 35]. Both time limits run from the date of the accident.

It is possible to sue initially for property damage only and to sue for personal injuries later, or vice versa.

For more detailed information, see Personal Injuries and Property Damage below.

Determining fault

In any court action for damages a person wanting to make a claim (the plaintiff) must prove that the other person (the defendant) has been negligent. To show this the plaintiff will need to prove that the defendant owed a duty to take care and breached that duty and as a result the plaintiff suffered loss or damage.

Whether or not the defendant has been negligent will depend on all the circumstances of the accident. Drivers of motor vehicles owe a duty to take care to all fellow road users, their passengers and pedestrians. Some of the more common breaches of the duty to take care are:

  • driving at a speed excessive in the circumstances
  • failing to keep a proper lookout for other traffic and road users
  • entering an intersection without regard for other traffic which may also be entering that intersection
  • driving the vehicle with insufficient control, for example because of intoxication by alcohol or drugs.

The fact that a driver has committed a breach of the road traffic laws does not necessarily mean she or he has been negligent [see Sibley v Kais [1967] HCA 43; (1967) 118 CLR 424]. It is only one of the factors which must be considered. All the surrounding factors at the time of the accident must be considered.

If a driver is charged with a criminal offence arising out of the accident and pleads guilty, this may be used as an admission of liability in the civil case. Legal advice should therefore be sought before the criminal case is heard. If however a driver is given an expiation notice and pays the fine, this is not an admission of liability. Anyone in doubt about whether the other driver was at fault should consult a private lawyer or get advice from one of our offices or a community legal service.

In many cases, it is impossible to say that only one party was at fault. In such a case, a court can apportion (share) the damages between the parties according to the degree of each one's responsibility. Where a party shares responsibility for an accident, that party is said to have been guilty of contributory negligence.

Contributory negligence occurs in accidents at intersections where, for example, the driver of the vehicle with right of way may be held 25% responsible. This is because every driver is supposed to drive safely in all circumstances. Thus failure to take reasonable steps to avoid an accident (perhaps because of excessive speed) may lead a court to find that the driver is partly responsible for the accident.

Part 7 of the Civil Liability Act 1936 (SA) does set out some instances (such as where a passenger fails to wear a seat belt or a cyclist fails to wear a safety helmet) where damages will be automatically apportioned (see Reduction of claims below).

Apportionment is not otherwise determined by legislation but instead is dependent upon all the relevant details of the accident. In some cases a person may recover 100% of her or his damages (for example, if the car was stationary and was hit by another car) but the possibility of apportionment must be considered. A person is not 10% at fault simply for being on the road.

Anyone unsure as to the extent of each person's fault should seek legal advice from the Commission or a community legal service or consult a private lawyer.

CONTRIBUTORY NEGLIGENCE

A's car and B's collide at an intersection. Each suffers $500 damages.

A sues B for $500 and B counter-claims (sues A) for the same amount.

B is found 80% responsible and A is 20% responsible.

A gets 80% of $500 = $400

B gets 20% of $500 = $100

'A' will be awarded damages of $400 less $100 = $300. In addition the court may order B to pay legal costs of say $150. This may be insufficient to fully reimburse A for payment to a solicitor. For example, A may have to pay the solicitor $250, leaving only $200 to cover damage to the car. If the cost of B's repairs is higher than A's, A may get nothing.

Personal Injuries

As of 1 July 2013 there have been significant changes to the Compulsory Third Party (CTP) Scheme. Whilst the CTP Scheme continues to operate as a fault based system, there have been changes to how injuries are assessed and the total amount that can be claimed in legal costs.

A new scheme that is not fault based, the Lifetime Support Scheme, will be introduced in July 2014. This Scheme covers people who sustain catastrophic injuries as a result of a motor vehicle accident regardless of who is at fault.

For all other injuries the Compulsory Third Party Scheme continues to operate on the basis of fault.

In addition to the headings covered in this topic, you may also want to check the section on 'Who is at fault?'.

Catastrophic Injuries and the Lifetime Support Scheme

The purpose of the Lifetime Support Scheme is to cover the costs of treatment, care and support for persons “catastrophically injured” in motor vehicle accidents, regardless of who was at fault and including those situations where no driver was at fault.

The Lifetime Support Scheme will not provide compensation for "pain and suffering" or economic loss (see What can be claimed? below) and the fault-based CTP scheme would still need to be used to recover such losses.

Part 2 of the Lifetime Support Scheme Rules defines what injuries may be considered "catastrophic" and include spinal cord injuries, traumatic brain injuries, amputations, severe burns and permanent blindness.

Compulsory Third Party (CTP) Insurance Scheme

Compulsory third party (personal injury) insurance covers drivers of your vehicle from claims for compensation for injuries or deaths arising out of the use of the motor vehicle. It is paid each time you register your vehicle [Motor Vehicles Act 1959 (SA)].

The aim of the insurance scheme set up by the Motor Vehicles Act 1959 (SA) is to ensure that every vehicle being used on the road is insured. The Compulsory Third Party (CTP) insurance in South Australia is provided by one of four insurance companies [Allianz, AAMI, QBE or SGIC] as of 1 July 2016. All registered motor vehicles in South Australia are automatically allocated a CTP insurer. If assistance is required in identifying the CTP insurer for a vehicle contact the Compulsory Third Party regulator on 1300 303 558. A vehicle registered in another state, while not covered under this Act, is covered by a similar Act in the owner’s home state while being used for a visit to South Australia.

Where a vehicle involved in an accident causing personal injury is unidentified or uninsured, the action is taken directly against the Nominal Defendant. This means that a person injured by, for example, a hit-run vehicle can take action and be compensated for those injuries even if the vehicle has not been identified. A person injured in a collision with a vehicle known to be uninsured or struck by an unidentified vehicle should immediately seek legal advice. To successfully claim damages for personal injury, a person injured by an unidentified vehicle must satisfy the court that reasonable steps have been taken to identify the vehicle. The plaintiff must also establish that the injury was a result of the other driver's negligence.

It is only possible to claim damages for personal injury if a person can prove that the defendant has been negligent, see Who is at fault?

Lifetime Support Scheme

From 1 July 2014 people who receive catastrophic injuries resulting in permanent disability (e.g. paraplegia, brain injury, serious burns or blindness) will qualify for support under the Lifetime Support Scheme. The Lifetime Support Scheme is a no fault scheme under the Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 (SA) and is administered by theLifetime Support Authority. Previously the Compulsory Third Party Scheme required evidence of fault for compensation to be payable. Where drivers suffered serious injury but no other car was involved (e.g. collision with a tree or a large animal) they were unable to claim compensation as no other driver was at fault.

The Scheme provides for treatment, care and support (e.g. medical treatment, pharmaceuticals, dental treatment, rehabilitation, respite care) but does not provide income support or pay damages for pain and suffering. As the Scheme is not retrospective people who sustained injuries prior to 1 July 2014 are not eligible and will be assessed under the previous scheme and rules.

Making a claim

Depending on the nature of the claim and the seriousness of the injuries, a personal injury claim can be dealt with in one of three ways:

  • a claim can be lodged with the Lifetime Support Authority (see Catastrophic Injuries and the Lifetime Support Scheme above);
  • a claim for other non-catastrophic injuries can be settled directly with the CTP insurer [i.e. Allianz, AAMI, QBE or SGIC]; or
  • a court action for damages can be taken and either settled during the proceedings or, if not settled, decided by the court.

Any court application for damages arising from personal injury must be made within three years of the accident [ Limitations of Actions Act 1936 (SA) s 36].

Children have until they turn 18 to commence an action (see Claims on behalf of children).

Time limits also apply to compensation claims made directly through the CTP insurer. Where the identity of the other vehicle is unknown or it is uninsured then the claim must be lodged as soon as reasonably practicable after this has been discovered. In all other cases it must be lodged within six months of the date of the accident [Motor Vehicles (Third Party Insurance) Regulations 2013 (SA) reg 126A]. There are several exemptions to this requirement including where the claimant is under a legal disability. A legal disability includes where the claimant is a child [reg 126A(2)]. Being a child is considered to be a disability as children are unable to make a claim or an application to a court in their own right.

When claiming compensation for personal injuries arising out of an accident, it is best to seek legal advice. Generally it will not be possible to settle a claim until the extent of the injuries are clear. This may not occur until a person recovers or until the injury stabilises.

If the injuries are minor and there is no continuing disability, it is usually advisable to attempt to settle the claim without going to court. This is done by giving the CTP insurer the relevant information enabling them to assess the value of the claim and to pay an agreed figure. Usually this procedure will bring a quicker settlement.

Where proceedings for personal injuries are taken in court, the Magistrates Court will hear claims up to $100 000, the District Court and the Supreme Court both have power to hear and determine claims for unlimited amounts. All actions for personal injury or death arising from motor vehicle accidents are now tried before a judge or a magistrate without a jury.

The first step in making a claim is to contact the allocated CTP insurer who will provide a claim form to be completed. If assistance is required in identifying the CTP insurer contact the Compulsory Third Party regulator on 1300 303 558.

Claims on behalf of children

The three year limitation period on an action for damages on behalf of a child does not commence until the child turns 18 years of age. However, most actions on behalf of children are commenced and disposed of before then. The action is usually commenced in the name of one of the parents as the 'next friend of the child'. If an action has been commenced on behalf of the child and the claim is settled, that settlement is not operative until approved by a judge of the court in which the proceedings have been commenced.

In cases of injury arising from a motor vehicle accident a defendant can ask for copies of medical and other records and reports relevant to injury suffered by the child or require the child to undergo a medical examination (at the expense of the defendant) to determine the nature and extent of the injury suffered [Limitation of Actions Act 1936 (SA) s 45A].

In order for there to be some certainty for the defendant in such cases a defendant can require the child to initiate legal action so that the claim can be determined by a court [s 45A(5)]. If the defendant provides written notice to the child’s parent or guardian requesting court action be initiated, they have six months from the date of the written notice to do so. A court may then make a determination of liability but adjourn the final assessment of damages until a later date.

If a plaintiff does not comply with these requests they are not prevented from bringing an action for damages at a later date, however, unless the court is satisfied that there was good reason for failing to comply, no damages will be awarded for medical or gratuitous services provided before the date the action was commenced. In addition no legal or other costs will be allowed [s 45A(7)].

What can be claimed?

In assessing the amount of damages to which an injured person is entitled, a number of different categories are recognised.

Non-economic loss

Claims can be made for non-economic losses, which may include:

  • pain and suffering;
  • loss of amenities of life;
  • loss of expectation of life;
  • disfigurement.

No claim exists for non-economic loss unless the person can show that her or his life has been significantly impaired for at least seven days, or that her or his medical expenses exceed the prescribed minimum [Civil Liability Act 1936 (SA) s 3].

The compensation payable for non-economic loss is assessed on a numerical scale (the Injury Scale Value or ISV) of 0 - 100 points. A relatively minor injury gains a low rating while the most severe injury will gain a rating of one hundred points. After determining the number of points a multiplier is used to calculate the awardable compensation [Civil Liability Act 1936 (SA) s 52(3)]. Damages for non-economic loss will only be awarded if the Injury Scale Value for the injury exceeds ten.

Expert legal advice should be obtained in relation to the assessment of an injured person’s compensation for non-economic loss.

Medical expenses

Any medical special damages incurred may be claimed. This includes items such as ambulance costs, x-rays and pathology tests. A person suffering ongoing medical problems may also be able to claim damages for future medical expenses.

There is a prescribed limit for medical services and charges. The limits are in accordance with the prescribed limits and services referred to in the Return to Work Regulations 2015 (SA). The insurer may recover from service providers (such as doctors) amounts paid for unnecessary services or charges in excess of the prescribed limit.

Economic loss

Where a person loses income because of injuries there may be a claim for the economic loss. It is not possible, however, to claim for the first week off work [Civil Liability Act 1936 (SA) s 54] and any claim for past or future loss of income must be discounted by 20%. There are new legislative guidelines for a court assessing a claim for future loss of earning capacity [Civil Liability Act 1936 (SA) s 56A (4)].

Gratuitous services

A parent, spouse, domestic partner or child of an injured person who gives voluntary (gratuitous) service to that person may be able to claim for this service [Civil Liability Act 1936 (SA) s 58]. An injury scale value of in excess of ten is required and the services being claimed must be provided for at least six hours a week over a period of at least six months.

Interest

A person who has had to wait for a claim to be paid may be able to claim interest. Interest is not paid for non-economic loss or for future losses [s 56].

Provisions relating to death caused by a motor vehicle injury

Dependants of a person who has died as a result of injuries received in a motor vehicle accident may be entitled to recover damages against the person responsible [Civil Liability Act 1936 (SA) ss 23, 24]. Legal action for damages must be commenced within three years of the death and issued by the executor of the estate of the deceased. However, the legal proceedings may only be begun in cases where someone else negligently caused the death. The following dependants are able to claim:

  • spouse or domestic partner
  • parent
  • brother or sister
  • child

Anyone involved in an accident should keep a record and receipts of all payments made resulting from the accident. If not yet paid, the accounts themselves should be retained, either to give to the allocated CTP insurer [i.e. Allianz, AAMI, QBE or SGIC] or to produce in court as proof of the claim.

Reduction of claims

If an injured person was not a wearing seat belt at the time of the accident, their damages will normally be reduced by 25%. The same reduction applies for cyclists and motorcyclists not wearing a safety helmet where there is a causal connection between the failure to wear a safety helmet and the extent of their injuries [Civil Liability Act 1936 (SA) s 49].

If an injured driver was contributorily negligent and he or she had a blood alcohol reading of 0.08 or more or their ability to drive was impaired due to drugs or alcohol then their damages must be reduced by the prescribed percentage or greater having regard to the extent to which the accident was attributable to their negligence. The prescribed amount is 50% for a blood alcohol reading 0.15 grams or more, or 25% in any other case [Civil Liability Act 1936 (SA) s 46].

A passenger who is injured and who knew or ought to have known that the driver's ability to drive was impaired by alcohol or drugs will also have any compensation reduced by the prescribed amount [Civil Liability Act 1936 (SA) s 47]. A passenger injured when not in a passenger compartment will have their damages reduced by 25%. Similarly, if the driver was inexperienced or unlicensed then the passenger's compensation will be reduced if the passenger was negligent in failing to care for her or his own safety.

Children

The above provisions do not affect a claim by a child under 16 years of age.

Finalising an injury claim

As a general rule, an injured person will not be able to finalise an injury claim until her or his injuries have stabilised. Often injuries take some time to stabilise and the extent of any disabilities will not be apparent immediately. The injured person must rely on medical advice about the disabilities and the advisability of settlement at any time during the action. Once a claim has been settled, the insurance company will obtain a signed Deed of Release from the injured person which will preclude any further action. The injured person must be guided by medical and legal advisers before settling a claim or signing a Deed of Release.

In settling a claim, the solicitor handling it will be able to advise the exact amount the injured party would receive in compensation. The solicitor's costs and disbursements will have to be deducted and there may be repayments for medical or hospital expenses, or sickness benefits from Centrelink which have been paid to the injured party whilst unable to work. All these factors must be investigated and considered before a claim is settled.

Before agreeing to accept a payment of compensation a person should always consider whether any benefits received will have to be repaid. Examples of benefits that may be recovered from compensation include:

Government agencies frequently seek refunds of these payments from people who receive payments from the Motor Accident Commission. This is a significant trap for people claiming compensation and expert advice should always be sought before settling any claim. In addition to the examples above, payments such as health insurance claims may be recovered depending on the fund involved.

Recovery against driver at fault

Where someone makes a claim and a driver is more than 25% at fault for the accident, the driver must pay an excess of up to $510 (as at 2013, increasing by CPI on 1 January each year) to the Motor Accident Commission [Motor Vehicles Act 1959 (SA) s 124AB(3)].

In certain circumstances, the Motor Accident Commission may also recover from the driver any money paid and any costs incurred [Motor Vehicles Act 1959 (SA) s 124A]. This is called a Reservation of Rights, and applies against the driver at fault when their actions are no longer covered under the Compulsory Third Party Insurance Scheme. The right to recover in this way will also apply to payments made as part of the Lifetime Support Scheme.

The Commission may recover money from the driver if the driver was:

  • driving a motor vehicle, or doing or omitting to do anything in relation to a motor vehicle, with the intention of causing the death of, or bodily injury to, a person or damage to another's property, or with reckless indifference as to whether such death, bodily injury or damage results [s 124A(1)(aa)]; or
  • so much under the influence of alcohol or drugs as to be incapable of exercising effective control of the vehicle [s 124A(1)(a)]; or
  • driving with a blood alcohol level equal to or above 0.1 grams of alcohol per 100 millilitres of blood [s 124A(1)(b)]; or
  • was using the vehicle without the consent of the owner [s 123].

The Motor Accident Commission is also able to recover from a driver, to the extent considered just and equitable given all the circumstances, any money paid by it [Motor Vehicles Act 1959 (SA) s 124A(2)] where the driver:

  • has committed an offence against section 43 of the Road Traffic Act 1961 (SA) (Duty to stop, give assistance and present to police where person killed or Injured). This is contrary to the Compulsory Third Party Insurance policy;
  • has not complied with any other term of the policy of insurance [s 124A(2)(a)];
  • failed to notify the Motor Accident Commission of details of the accident as soon as reasonably practicable or gave false information [Motor Vehicles Act 1959 (SA) s 124(1), (2), (6)];
  • drove the vehicle overloaded, or in an unsafe, unroadworthy, or damaged condition [Motor Vehicles Act 1959 sch 4];
  • was driving without a licence [Motor Vehicles Act 1959 sch 4];
  • failed on the request of the CTP insurer to produce her or his licence or certificate of registration [s 124(5)];
  • without the written consent of the Motor Accident Commission entered upon any legal action or incurred any cost in any legal action, made an offer or promise of payment, made any payment, or made an admission of liability in relation to the matter [s 126];
  • authorised the repair or dismantling of the vehicle without the written consent of the Motor Accident Commission, or wilfully caused the damage to the vehicle [s 126].

Owners and drivers have a positive duty on to cooperate with the Motor Accident Commission (the insurer) [Motor Vehicles Act 1959 (SA) s 124]. The insurer also has the power to compulsorily acquire a motor vehicle for the purposes of the conduct of negotiations or proceedings [s 125B].

Property Damage

This section provides details on what to do if you have been involved in an accident and how to recover the cost of repairs to a motor vehicle. For a complete guide to handling your own motor vehicle claim see our Motor Vehicle Accident Kit.*

*Please note, as an amendment to the Motor Vehicle Accident Kit, the increase in the limit for minor civil claims in the Magistrates Court of South Australia, which is now for claims under $12 000.

At the scene of the accident

  1. Exchange your name, address and vehicle registration number with the other driver involved in the accident and any witnesses
  2. If you are not the owner of the vehicle you were driving, you should also give the owner's name and address to the other driver.
  3. DON'T admit liability even if you think you are at fault - this may affect any subsequent claim you might make
  4. DON'T argue about the issue of fault - this is a matter to be determined later and should never be discussed in the heat of the moment
  5. If there are any witnesses ask them for their name, address and phone number.
  6. If possible, do a small diagram of the accident scene and make note of key measurements such as length of skid marks, distance of vehicle from the kerb, etc.

You should notify your insurance company as soon as possible after the accident, even if you have not decided to make a claim.

The RAA provides an accident report form on its website and a legal advisory service is available for members.

Insurance

Types of insurance

Compulsory Third Party Bodily Injury Insurance

This type of insurance is paid when you pay for the registration of your vehicle. It covers injury to other people resulting from the liability of an owner, driver or passenger of the vehicle.

Third Party Property Damage Insurance

This type of insurance is not compulsory but it is recommended that every car should have it as minimum cover. Even if your car itself is not worth much money, there is still a risk that if you hit someone else’s vehicle you may be liable for expensive repairs.

Third Party Property insurance covers damage to other vehicles or property resulting when the driver of your vehicle is negligent. This type of insurance does not cover damage to your own vehicle.

It is also possible to get Third Party Property Damage Extension insurance for circumstances where the other person is at fault for the accident, can be identified and is not insured. However, this is normally limited to a certain amount.

Third Party Property Damage, Fire and Theft

In addition to Third Party Property Damage the insured vehicle is also covered for fire and theft.

Comprehensive Insurance

This type of insurance covers third party property damage AND damage or loss to your own vehicle.

Assessing the damage - if other driver at fault

If your vehicle is damaged as the result of an accident and you believe the other driver to be at fault you will need to establish the extent of the damages from the accident and how much it will cost to repair these damages.

  1. Obtain a written quote from a reputable repairer of your choice. The quote should be an itemised quote providing detail of exactly what work must be done and how much parts and labour will cost.
  2. Whilst only one quote is necessary it may be better to get two as the other driver may wish to have a point of comparison.
  3. If the quote for repairs is high and exceeds the value of your vehicle then the vehicle is not worth repairing as it is a write-off. To check on the market value of your car you can refer to The Red Book at www.redbook.com.au .
  4. If there is a dispute about the value of your car you will need to get an automotive valuer to provide a written report. You will also need to get a written estimate from wreckers as to what you would get for the damaged vehicle for wrecking purposes.
  5. In the situation where the other party is claiming that their vehicle is a write-off you may wish to obtain your own independent assessment as a comparison to that offered by the other party. However, you must seek the other party’s permission before your assessor can inspect their vehicle.
  6. Take photographs of the car as proof of the damage. If you have to proceed to court this will be useful evidence to have.
  7. You do not require the approval of the other driver to have your car repaired. However, if the matter is yet to be settled you will need to pay the repairer yourself and ask the driver to pay you. The other driver cannot insist on paying the repairer directly. If they are liable for the damage caused to your vehicle any money they owe is directly payable to you as the owner of the vehicle.
  8. If you cannot afford the cost of repairs and have to wait for payment from the other party you should not let the vehicle’s condition deteriorate as this will increase the cost of repairs and the other driver will not be liable for any extra costs resulting from the deterioration.
  9. If your vehicle is a write-off you can dispose of it but before you do you should first obtain a written estimate of its pre-accident value and its value as a wreck.

Assessing the damage - if you are at fault

If you are responsible for damage to the other driver’s vehicle, the other driver should contact you in writing to advise you of what the damage is and how much it is going to cost to repair.

If you haven’t been given a copy of the other driver’s crash repair quote or assessor’s report, write to the other driver or insurance company and request it.

The other driver is only required to provide one repair quote. You are entitled to have a fully itemised quote provided so you can check to see that the work being quoted is related to the damage caused by the accident.

The other driver can proceed with repairs prior to getting the money from you. If they decide to wait to recover the money from you before getting any repairs done they must prevent the vehicle’s condition from deteriorating further, and if any deterioration occurs they will be liable for these costs.

The other driver is entitled to payment directly and you cannot insist on paying the money to the repairer yourself.

If the other driver’s vehicle is a write-off, request a copy of a written estimate of its pre-accident value and its value as a wreck from the other driver.

Contacting the other driver or their insurance company

  1. You will need to write a letter to the other driver giving him/her notice that you believe they are responsible for the damage caused to your vehicle and how much money it will cost to repair.
  2. You do not have to get more than one quote but it is standard practice to supply two and the other driver is entitled to accept the cheaper of the quotes.
  3. If your car is a write-off, you need to provide the other driver with a copy of a valuer’s report and the wrecker’s estimate (or receipt if you have sold it).
  4. You are under no obligation to allow the other party to have a look at the vehicle but you may do so if you wish.

Note: your claim is limited to the amount required to restore the car to its pre-accident condition. You cannot claim for any other damage that was there before the accident and the other driver is entitled to require you to prove that the damage you are claiming was the result of the accident and not pre-existing damage.

How do I write a letter to the other driver/other driver’s insurance company?

It is important to write the words ‘Without Prejudice’ on the top of every letter to the other party (or their insurance company) written for the purposes of negotiating a settlement. ‘Without Prejudice’ means that any statement made in the letter about who caused the accident cannot be used as evidence in court against you unless the other party gets your consent to do so.

The letter needs to provide the following information:

  • a) The date of the accident
  • b) The make of your vehicle and its registration number
  • c) The make of the other driver’s vehicle and its registration number
  • d) The names of the road(s) or street(s) where the accident occurred
  • e) The suburb in which the accident happened
  • f) The time of day when the accident happened
  • g) The total amount of quote or valuation

Always keep a copy of any letter sent and make sure each letter is signed and dated.

SAMPLE LETTER - contacting the other driver

IMPORTANT: It is very important to remember to write the words WITHOUT PREJUDICE on the top of every letter to the other party (or their insurance company) written for the purpose of negotiating a settlement. WITHOUT PREJUDICE means that any statement that you make in the letter about who caused the accident cannot be used as evidence in court against you unless the other party obtains your consent. This is important in case the matter has to be decided in court.

Without Prejudice

Your Name

Your Address

Date

Other Person’s Name

Address

Dear

I refer to the motor vehicle accident as follows:

DATE: MY VEHICLE:

LOCATION:

SUBURB: YOUR VEHICLE:

TIME: am/pm

I consider that you are responsible for this accident and as such are liable to pay for the damage caused by the accident to my vehicle.

* Please find enclosed a copy of a quote from a crash repairer for the cost of repairs to my vehicle in the sum of $..............

* My vehicle is now a ‘write off’. Please find a copy of a valuation of my vehicle before the accident $ ………………. and an estimation of the value of my vehicle as a wreck $.......

My loss is therefore the difference between the two values which amounts to $......... .

* (Use one of the paragraphs stated above)

If you intend to claim through your insurance company, please provide me with your insurance details and please ask your insurance company to contact me regarding my claim.

If you are not covered by, or claiming on insurance, I shall expect you to pay for the damage to my vehicle.

Unless the matter is settled to my satisfaction within the next 21 days I intend to take legal action to recover this amount from you.

Yours sincerely

SAMPLE LETTER - if the other driver contacts you

Without Prejudice

Your Name

Your Address

Date

* Other Person’s Name/Insurance Company

(*one of the above)

Address

Dear

Motor Vehicle Accident

DATE: MY VEHICLE:

LOCATION:

SUBURB: YOUR VEHICLE:

TIME: am/pm

I refer to your letter dated ………………………………. regarding this accident.

I do not accept that the accident was entirely my fault. However, I am prepared to discuss a settlement in this case.

* Please find enclosed a copy of a quote from a crash repairer for the cost of repairs to my vehicle in the sum of $.........................(plus towing fee if applicable).

(OR)

* My vehicle is now a ‘write off’. Please find enclosed a copy of a valuation of my vehicle before the accident $................... and an estimation of the value of my vehicle as a wreck $................ . My loss is therefore the difference between these two values which amounts to $.............. .

* (Use one of the paragraphs stated above)

** If you intend to claim through your insurance company, please provide me with your insurance details and ask you insurance company to contact me regarding settlement of the claim.

** (Only use this paragraph if the letter you have received is from the other driver and not an insurance company)

I look forward to hearing from you.

Yours sincerely

Dealing with the other driver's claim

If the other driver/other driver’s insurance company has made a claim against you, you need to decide whether or not you think the amount they are claiming is reasonable. You can only be asked to pay the costs of damage caused by the accident so you do not have to pay for any damage that was there before. However, a number of reasonable costs can be legitimately claimed by the other driver including:

  • Valuation fees
  • Towing fees
  • Replacement costs for personal property damaged in the accident
  • Hire car costs

If you do not agree with the amount being claimed you will need to get an independent assessment of the damage but you will require the other party’s permission to do this and must pay for the assessment yourself.

Where an insurance assessor has checked the repair quote or the valuation of a vehicle, it may be difficult to dispute the amount claimed unless it can be established that the other driver is claiming for unnecessary work. For example, you do not have to pay for new panels when second hand would do.

Determining fault and how much money to be paid

It is usually the case that both drivers are at fault to some extent. You need to be realistic about who caused the accident and any liability you yourself might have towards the damage caused.

It is recommended that you determine how much you were at fault. This could be anywhere from 0% (no fault) to 100% (total fault). There is no simple formula that can be applied and if the matter proceeds to court the court will look at all the circumstances of the accident to decide how much each side was at fault.

Contrary to what some people say, it is possible for one driver to be 100% at fault, although this is usually quite rare. Examples where this would be the case include where a driver runs into the rear of another vehicle or where a driver collides with a stationary vehicle.

The percentage of fault lets you work out how much you and the other driver (or his/her insurance company) will have to pay.

YOU WILL BE PAID THAT PERCENTAGE OF YOUR DAMAGES WHICH IS NOT YOUR FAULT BUT YOU HAVE TO PAY THAT PERCENTAGE OF THE OTHER DRIVER’S DAMAGES WHICH IS YOUR FAULT.

Example:

Driver A is held to be 50% to blame for the accident and the cost of repairs to her vehicle is $1 500.

Driver B then is also 50% to blame and the cost of his repairs is $1 000.

A is liable to B for 50% of his costs (i.e. of $1,000) = $500

B is liable to A for 50% of her costs (i.e. of $1,500) = $750

This means that in practice, B must pay $250 to A. Both drivers owe each other at least $500 so the real amount that will be paid will be any amount in excess of $500. As a result B must pay the $1,000 to repair his own vehicle in addition to $250 towards A’s damage.

Example:

Driver A is held to be 85% to blame for the accident and the cost of repairs to her vehicle is $3 000.

Driver B then is 15% to blame and the cost of his repairs is $4 500.

A is liable to B for 85% of $4 500 = $3 825

B is liable to A for 15% of $3 000 = $450

The difference between $3 825 and $450 is $3 375.

In this case, A must pay for all the damage to her vehicle as well as paying $3 375 towards B’s damage.

B will have to pay the extra $1 125 to have his vehicle repaired.

Reaching a settlement

It is usually better to sort out your claim with the other driver by negotiation rather than by going to court. Going to court may cost more money and is often very stressful.

Even if you go to court and win, the other person cannot be forced to pay more than they can reasonably afford. If the other person is not employed and has no assets, it may be very difficult to recover the money owed to you.

In making the decision as to whether to take the other driver to court you need to consider the financial position of the other person. If the other person is offering part payment or payment by installments it may be better to accept this rather than go to court. You may have to accept a smaller amount of money than you expected to get the other party to pay.

If an agreement is reached on settlement it should be recorded in writing and signed by the person or people agreeing to pay.

  1. Once you have worked out the likely liability you will need to write to the other driver (or their insurance company) and tell them the percentage at which you are prepared to settle.

You can start by offering a figure 10% or 20% higher and come down later if you want. For example, if you are advised that the other driver will ultimately be 50% liable, you may suggest they are 60% or 70% liable.

  1. Remember to write the words “Without Prejudice” at the top of any negotiation letters you write.
  2. Tell the other driver (or their insurance company) how much he/she will have to pay you or how much you will pay them if they accept your offer.
  3. Make sure you tell the other driver (or their insurance company) in your letter why it is that you think they are at fault. This will help them understand your offer.

Dealing with insurance companies

It is easy, particularly for uninsured drivers, to feel intimidated by insurance companies. They often refuse to negotiate at first and often will refuse to admit any liability on the part of their insured driver. It is important not to give up at this point. Keep trying to make offers. Insurance companies prefer to settle disputes out of court just like everyone else. This is because it is often time consuming and more expensive to take a matter to court.

Maintain contact with the insurance company. Always let them know if you change your address or phone number because if they don’t hear from you they will assume that you don’t want to negotiate.

Always keep notes of any conversations you have with insurance company employees and record the date of the conversation.

Keep copies of all letters you send and get legal advice about the extent of your liability before you start negotiating.

If an insurance company makes a verbal offer, ask that the offer be put in writing for your consideration.

The settlement

Do not pay any money to the other driver or their insurance company until that person has signed an agreement in writing. Also get a signed receipt when you pay.

What you need to do

  1. You should write an agreement which documents all the things you have agreed upon.
  2. The agreement should contain a statement saying that the agreement is “a full and final settlement” of both your claims.
  3. The agreement should refer to the date and location of the accident and the vehicle(s) involved in the accident.
  4. The agreement will normally be between the owners of the motor vehicles, who are usually the drivers as well.

SAMPLE AGREEMENT RELATING TO MOTOR VEHICLE ACCIDENT

Date of Accident:

Time of Accident:

Place of Accident:

Vehicles Involved:

In consideration of (Driver/Owner A – insert name) of (insert address) paying the sum of $ (amount) to (Owner B – insert name) of (insert address), (Owner B – insert name) hereby agrees not to bring any legal proceedings whatsoever against (Driver/Owner A – insert name) to recover any sum for the damage to his/her motor vehicle in this accident.

The parties agree that this Agreement is a full and final settlement of any claim they may have for the damage to their respective motor vehicles arising out of this accident.

DATED:

Signed:

DATED:

Signed:

Legal proceedings

If you cannot come to a satisfactory agreement and you want the other party to pay for your damage you must go to the Magistrates Court nearest to where the accident took place and fill out the appropriate forms for the matter to be decided in court.

If the amount claimed does not exceed $12 000, the claim is called a minor civil claim. The claim includes the damage to the vehicle and costs reasonably incurred as a result of the accident. For more information about making a minor civil claim see COURT - SUING OR BEING SUED, Minor Civil Actions.

If your claim is more than $12 000, seek legal advice.

Written-off vehicles

A vehicle is a written-off vehicle if it is:

  • a total loss; or
  • is to be, or has been, wrecked or disassembled for salvage; or
  • is to be, or has been, sold or acquired for wrecking or salvage.

Total loss is defined as a vehicle damaged by accident, collision, demolition, dismantly, fire, flood or other event, to the extent that its fair salvage value, when added to the cost of repairing it so it is roadworthy, would be more than its fair market value immediately before the event that caused the damage [Motor Vehicles Regulations 2010 reg 71].

There are two categories of written-off vehicles. A vehicle may be declared to be a statutory write-off if it has severe structural damage that prevents it from being driven safely. Only an authorised insurer or agent has the authority to declare a vehicle a statutory write-off.

A vehicle that has been declared a statutory write-off cannot be registered and must not be driven. A statutory write-off cannot be repaired.

Penalty:

  • in the case of an offence committed in the course of a trade or business the maximum penalty is $2 500
  • in any other case the maximum penalty is $1 250

All statutory write-offs must be notified to the Registrar of Motor Vehicles.

A vehicle that has sustained substantial damage but does not meet the definition of a statutory write-off may be declared a repairable write-off. Generally these will be vehicles that have the potential to be repaired, although significant rebuilding will be required. The owner of the vehicle, an insurer or an authorised motor trade agent can declare a vehicle a repairable write-off after an accident. A vehicle declared a repairable write-off must not be driven other than for the purpose of being driven to or from a place of repair or inspection.

Penalty for driving a notified written-off vehicle on a road (other than to or from a place of repair or inspection):

  • in the case of an offence committed in the course of a trade or business -- $2 500 maximum penalty
  • in any other case -- $1 250 (maximum penalty)

The Registrar of Motor Vehicles must be given notice of any written-off vehicle and a notice must be affixed to the vehicle as specified by the Regulations.

    Motor vehicle accidents  :  Last Revised: Fri May 30th 2014
    The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.