Secondary victim psychiatric injury claims in NSW CTP

The insurer will usually examine the claimant’s own exposure, diagnosis and causation rather than assume a family relationship creates entitlement. Key focus areas include:

• Relationship and exposure: What was your relationship to the person involved, and exactly what did you witness or confront?
• Perception: How and when did you become aware of the event? Did you see it happen, or did you encounter the immediate aftermath?
• Diagnosis: Is there a diagnosis supported by the applicable criteria, or do the records describe grief, distress or symptoms without a recognised illness?
• Causation: Can the psychiatric injury be directly tied to the accident experience rather than unrelated life stresses?

The evidence should connect the traumatic event, the diagnosed condition and the claimant’s current function. Insurers commonly compare the chronology across multiple records.

• Exposure chronology: A clear, dated record explaining exactly how you witnessed the event or encountered the immediate aftermath.
• Diagnosis quality: GP, psychologist and psychiatrist records should identify the diagnosis being considered, the supporting symptoms and the reason the condition is linked to the accident.
• Functional impact: Concrete examples of how the injury affects your work, study, sleep, relationships, and daily independence.
• Pathway separation: Keeping psychiatric-injury evidence distinct from funeral expenses or dependency claims to avoid administrative confusion.

Insurers may contest secondary-victim claims on eligibility, diagnosis or causation grounds. A dated record helps identify the exact issue rather than treating every objection as the same dispute.

• Eligibility objections: Contesting whether you fit the legal definition of a secondary victim, especially if your exposure was indirect.
• Pre-existing conditions: Arguing that your condition flows from prior vulnerabilities or general grief rather than the specific accident event.
• Threshold injury classification: Whether the symptoms amount to a recognised psychiatric illness and whether the diagnosis is one that the Regulation includes as threshold.
• Treatment necessity: Refusing to pay for specialized counselling or psychiatric care on the basis that it is not "reasonable and necessary."

If a decision has issued against you, you may need to seek an internal review or escalate the matter to the Personal Injury Commission.

Part 5 of the current Motor Accident Guidelines deals with threshold psychological or psychiatric injury. Symptoms that do not meet the criteria for a recognised psychiatric illness are threshold injuries. Adjustment disorder and acute stress disorder are also included as threshold injuries under the current scheme. A diagnosis such as PTSD or major depressive disorder still needs to be established and causally connected to the accident; it should not be assumed from symptoms alone.

Permanent impairment is a different question. Under Part 6, psychiatric impairment must be assessed by a psychiatrist using the Psychiatric Impairment Rating Scale (PIRS). The assessment considers function across the PIRS areas after addressing diagnosis, causation, treatment and stability. Physical and psychiatric WPI cannot be combined to decide whether impairment is greater than 10%.

Neither a non-threshold classification nor a WPI assessment automatically creates a damages entitlement. Fault, causation, loss and the separate statutory requirements still need to be considered.

These files often start as a disagreement over a single point (like treatment) but can branch into several decision streams. Treating a multi-issue denial as one vague problem often slows down the resolution.

• Identify the live issues: Is the problem liability, treatment, capacity, or threshold classification?
• Focus on chronology: A coherent timeline is often more effective than a high volume of unorganized counselling notes.
• IME preparation: If an Independent Medical Examination is scheduled, ensure your symptom history and functional restrictions are clearly documented beforehand.

For more on dispute pathways, see treatment refused disputes and merit review vs medical assessment.

Keep the insurer letter, claim number and deadline together. Prepare a short exposure chronology, the earliest GP notes, referral and treatment records, medication history, work-capacity evidence and any psychiatrist report. If the insurer has made several decisions, separate treatment, weekly-payment, threshold and damages issues before choosing an internal review or PIC process.

Seek advice promptly if the insurer disputes the legal pathway, says there is no recognised illness, relies on an IME that does not address the treating record, or imposes a review deadline.

Threshold injury: Motor Accident Guidelines Part 5, including clauses 5.10-5.12, read with the Motor Accident Injuries Act 2017 and Regulation. Psychiatric WPI: Motor Accident Guidelines Part 6, including clauses 6.36-6.37 and 6.201-6.217 (PIRS).