Reasonable action to claim compensation 117-01010020

A person who has suffered a personal injury and has lost earnings or lost the ability to earn maybe entitled to compensation. Personal injury can also include a disease or condition.

If they claim an income support payment from Services Australia, they must take reasonable action to claim or obtain compensation. This applies even if the compensable event occurred while the customer was overseas.

The compensation recovery provisions of social security law are designed to make sure that people who get compensation for a loss of income do not also get income support from the Australian Government in respect of the same period of time.

Taking reasonable action to claim compensation includes but is not limited to:

• lodging a claim, along with any medical evidence, with their employer, or with the compensation payer
• starting legal proceedings by engaging the services of a solicitor
• seeking legal advice on whether a claim could be successfully pursued

The Resources page contains scenarios

A customer may suffer an injury, which is or may be compensable, however, they have not claimed or taken action to get compensation. This may occur because the customer:

• is unaware they may have an entitlement to seek compensation
• may not want to seek compensation, or may feel they do not need to seek compensation
• would prefer to receive an income support payment
• or someone on behalf of the customer (legal guardian etc.), may have agreed to give up the right to compensation

Compensation payers and insurers have the primary responsibility to provide support to customers who because of a compensable injury are unable to work.

Customers who have not taken action or not taken reasonable action to claim compensation, may be given notice to take action to claim compensation. This presents an opportunity for a customer to explain their circumstances. The Compensation Recovery Team (CRT) will determine whether documents/evidence is required and any impact on the customer to comply with the request.

Failure to take reasonable action to claim compensation can be a breach of section 1166 of the Social Security Act 1991.

Failure to make a claim may mean that the customer’s income support payment:

• is suspended
• cancelled
• claim is rejected

When they take reasonable action their payments may be granted or restored.

The Resources page contains scenarios.

When a customer makes a claim for compensation, the customer cannot change their mind and withdraw the claim. The claim must go through the entire assessment and decision-making process.

Compensation payers or insurers decide if the customer and/or their partner are eligible for compensation payments.

If the compensation payer or insurer refuses liability or determines that the customer is not eligible for compensation, the customer is regarded to have met their obligations.

If the Compensation Recovery Team (CRT) is satisfied that the customer may be entitled to compensation, and the customer has not taken any reasonable action to claim or obtain compensation. The CRT must decide if the customer needs to provide supporting documents/evidence that demonstrates the required action has been taken.

Any request for information must be made in writing, requests must include:

• Details of the information or action required
• The time allowed to respond
• The consequences of non-compliance
• The reference to the relevant Act that the request has been made under

The Compensation Recovery Team (CRT) will take into account the customer’s individual circumstances where it may be acceptable not to pursue a claim for compensation, and may include reasons:

• Time limitation periods
• Jurisdiction
• Complexities of establishing liability, including contributory negligence
• Difficulties the customer has encountered when seeking legal or other assistance
• The customer’s financial circumstances

When determining whether reasonable action has been taken, the CRT may consider, but is not limited to, the following:

• Whether legal advice has been sought
• Whether a lawyer has been engaged to commence legal proceedings and/or
• Whether a claim for compensation has been lodged with the appropriate body with relevant evidence.

What is reasonable must be determined having considered the context and circumstances of each individual case.

Where a Compensation Recovery Officer (CRO) has made a decision that the customer has not reasonably pursued their compensation claim, they must seek approval from a delegated officer. The delegation to determine if the customer has not taken reasonable action is held by an APS5 or above within Compensation Recovery operational teams.

The Resources page contains scenarios.