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NSW CTP Scheme Efficiency

Efficiency of the CTP Scheme is measured by analysing the actual amount of premiums paid out as benefits to those injured in motor vehicle accidents.


These benefits include both economic and non-economic costs. The less the service delivery costs the more efficient the scheme is. These costs refer to any legal or investigative expenses, insurers return on investment and their expenses, operating costs of the MAA and any commission paid to the RMS.

Any legal costs which are incurred by hiring private solicitors where actual charges by the solicitor to the claimant directly are above the regulated amount is not accounted for. This amount is not known to the insurer or the regulator, according to the MAA’s independent actuaries.

According to the MAA Annual Report 2012-13, the scheme efficiency stands at 50 percent for all policies vended earlier than 2007 while all the policies sold beyond this point has efficiency levels of at least 50 to 65 percent. But these numbers are based on estimates as actual claims can take up to five years to be paid out. Therefore the actual statistic may be very different form this presumed one.