The Fiji Government has made major changes to the motor vehicle compensation scheme by removing the requirement for drivers to hold third party insurance.
Instead of paying insurance premiums to insurers, drivers will now pay into the Accident Compensation Fund at the time they register their car. When suffering a road related injury individuals will be able to apply for compensation through the Accident Compensation Commission Fiji (‘ACCF’).
Every person on our roads is at risk of injury or causing injury from a motor vehicle. Up until now, you have been required to take out third-party insurance in order to indemnify yourself and others from the dangers we face each and every day. However, the Accident Compensation Act 2017 (‘Act’), has completely changed this requirement and the entire compensation scheme around motor vehicle accidents in Fiji.
The Act is significant because it creates a completely new system impacting all motor-vehicle owners, with over 100,000 registered cars in Fiji. Specifically, it introduces two principal changes:
the establishment of the ACCF; and
a “no fault compensation scheme”.
A no fault scheme presents significant advantages. From the driver’s perspective, it saves time as it requires direct payment of additional levies to the LTA rather than seeking out third party insurance. Further, it is simple to navigate with one entry point for all claims and much faster as the ACCF has a statutory obligation to review applications and make payments as soon as practicable. The system is overall more affordable: administrative costs are lower and compensation awards are lower on average. However, accepting payment under the scheme may affect a driver’s rights to judicial review and more broadly removes the role of private insurance companies.
No fault compensation scheme
There will no longer be a need for vehicle owners to take third-party insurance from an insurance company. Instead, levies will be paid into the Accident Compensation Fund through the LTA. Third party policies (for any personal injury and death) issued prior to 1 January 2018 remain valid until their expiration or cancellation, withdrawal or revocation.
The Act introduces a no fault compensation scheme. This means that any person injured as a result of an accident is covered and/or compensated without the need to establish fault or negligence. The scheme applies to accidents from 1 January 2018. Proceedings covered by third party insurance will be covered by the old legislation.
Those involved in a motor vehicle incident will have to follow a simple three step process in order to receive compensation:
1. Application to the Commission – providing the relevant details of the incident, including relevant medical examinations;
2. Review by the Commission – the Commission will review applications against regulations, ascertaining the amount payable;
3. Applicant to accept or not to accept – the applicant may then accept or refuse any compensation. Upon acceptance any future legal claims or action will be barred. Alternatively, a person may refuse and request a review.
Alternatively, if the applicant does not accept, the person may file a claim or action in a Court or Tribunal for compensation under common law. The person instituting the claim must provide all relevant documents and particulars to the Commission and the Commissions may require further information. At the outcome, the Commission is to satisfy judgments of the Courts or Tribunals. Interestingly, the Act provides authority to the Minister of Justice to prescribe the maximum amount that the Courts or Tribunal can award.
Once your current third-party insurance has expired, you will need to pay into the Accident Compensation Fund. Then you may access the no-fault scheme whenever involved in an accident.
For more information please contact:
T +679 3275 160
T +679 327 5160