Psychological Injury After a Car Accident: When PTSD or Depression Is Not a Threshold Injury
Not every injury from a car accident is visible. Long after the bruises fade, some people find they cannot get back behind the wheel without their heart racing, cannot sleep, cannot shake the images of the crash, or feel a heaviness and hopelessness that will not lift. These are real injuries, they can be every bit as disabling as a physical one, and the CTP scheme in New South Wales does recognise them. Yet psychological injuries are among the most under reported and under claimed of all.
Part of the reason is a piece of the law that decides a great deal but is poorly understood. Whether your psychological injury is treated as a threshold injury, which limits your entitlements, or as something more, depends on whether it amounts to a recognised psychiatric illness. For conditions like post traumatic stress disorder and major depression, that distinction can change your claim entirely.
This guide explains when a psychological injury after a car accident is more than a threshold injury, what that means for your entitlements, and why these injuries are so often missed. Please treat it as general information rather than advice about your own claim, and you should seek legal advice about your particular situation before making decisions about it. If you are struggling with your mental health, it is also worth speaking to your doctor or a support service, quite apart from any claim.
Can you claim for a psychological injury after a car accident?
Yes. A psychological or psychiatric injury caused by a motor accident is compensable under the Motor Accident Injuries Act 2017 (NSW), the scheme regulated by the State Insurance Regulatory Authority, known as SIRA, in the same way a physical injury is. You do not need to have been physically hurt at all. A person who walks away from a crash without a scratch but develops a serious psychological condition as a result can still have a claim.
Like any CTP claim, you can access early statutory benefits, income support and treatment, and where your injury is serious enough and another party was at fault, you may be able to pursue common law damages. But for psychological injuries, one classification question sits in front of all of that, and it is worth understanding clearly.
The key question: is it a recognised psychiatric illness?
Under the scheme, a psychological or psychiatric injury is a threshold injury, once called a minor injury, if it is not a recognised psychiatric illness. Turn that around, and the point becomes clear. A psychological injury that does amount to a recognised psychiatric illness is more than a threshold injury.
This matters because threshold injuries carry limited entitlements, while injuries that are more than threshold injuries open the door to ongoing benefits and to a damages claim. So for a psychological injury, the whole question of what you are entitled to often comes down to whether your condition is a recognised psychiatric illness, properly diagnosed.
There is one important wrinkle. Two conditions that are, in clinical terms, recognised, are nonetheless specifically classed as threshold injuries by the scheme, namely adjustment disorder and acute stress disorder. So not every diagnosis lifts a claim above the threshold. The conditions that generally do include post traumatic stress disorder and major depression.
Which psychological conditions are, and are not, threshold injuries
The table below sets out where common conditions fall. The classification depends on a proper diagnosis, not on how distressed a person feels.
| Psychological condition | Threshold or more than a threshold injury? |
|---|---|
| A general stress or emotional reaction that is not a diagnosed illness | Threshold injury |
| Adjustment disorder | Threshold injury, specifically classed as one |
| Acute stress disorder | Threshold injury, specifically classed as one |
| Post traumatic stress disorder | More than a threshold injury |
| Major depressive disorder | More than a threshold injury |
| Other recognised psychiatric illnesses | More than a threshold injury |
The practical lesson is that the same set of symptoms can be recorded in very different ways. Described loosely as stress, they may be treated as a threshold injury. Properly assessed and diagnosed as post traumatic stress disorder or major depression, they are more than a threshold injury. The diagnosis is decisive, which is why getting a proper psychiatric assessment matters so much.
What the classification means for your claim
If your psychological injury is more than a threshold injury, the consequences are significant.
Your statutory benefits, your income support and treatment, can continue beyond the first 52 weeks, provided you were not wholly or mostly at fault, rather than stopping at the one year mark as they generally do for a threshold injury. And a common law damages claim becomes possible where another party was at fault, allowing you to claim for your past and future loss of earnings. If your permanent psychiatric impairment is greater than 10 per cent, you may also be able to claim damages for pain and suffering.
If, on the other hand, your psychological injury is treated as a threshold injury, your benefits are generally confined to the first 52 weeks and a damages claim is not available. That is the difference the classification makes, and it is why a psychological injury should never be brushed aside or left off the record.
How psychological injury is diagnosed and assessed
Because the classification turns on diagnosis, the medical assessment is central. A recognised psychiatric illness is diagnosed by a qualified practitioner, usually a psychiatrist, against the accepted diagnostic criteria set out in the standard psychiatric manual, known as the DSM. A diagnosis of post traumatic stress disorder or major depression carries far more weight than a note simply recording that a person seemed stressed or upset.
Where the seriousness of a psychiatric injury needs to be measured, for example for the pain and suffering threshold, impairment is assessed using a specific tool, the Psychiatric Impairment Rating Scale, or PIRS. It is worth knowing that psychiatric impairment is assessed separately from physical impairment, and the two cannot be added together to reach the 10 per cent threshold. A person with both physical and psychological injuries needs to reach the threshold within one category or the other, not by combining them.
Why psychological injuries are so often missed
Understanding why these injuries go unrecognised helps you avoid the same outcome.
Many people simply do not report their psychological symptoms. In the aftermath of a crash, physical injuries take priority, and there can be a reluctance, or a stigma, around raising mental health with a doctor. If it is not mentioned, it does not go on the record, and the insurer cannot recognise what it cannot see.
When symptoms are mentioned, they are often recorded in vague terms. A note of stress or feeling down is not the same as a diagnosis, and a claim built on loose language is easily treated as a threshold injury.
Psychological conditions also frequently develop over time. What begins as understandable distress in the weeks after an accident can settle into post traumatic stress disorder or depression months later, by which point the early records may not reflect the true picture. This is why a proper assessment, at the right time, is so important.
None of this reflects any weakness on the part of the injured person. It reflects how easily a genuine and serious injury can be under documented, and how much difference a proper diagnosis makes.
If your psychological injury is wrongly classed as a threshold injury
If the insurer has treated your psychological injury as a threshold injury and you believe it is more serious than that, the decision can be challenged. A threshold injury decision is a medical dispute, which can be reviewed by the insurer and then referred to an independent medical assessor at the Personal Injury Commission, who for a psychological injury will be a qualified psychiatrist. Many of these decisions are revisited once a proper psychiatric assessment is provided. Our guide on what to do when the insurer says your injury is a threshold injury explains that process, and you can read more about the classification generally in our guide on threshold and non threshold injuries.
How Stephen Young Lawyers can help
Psychological injury claims are too easily lost through under documentation rather than lack of merit. The symptoms are real, but if they are recorded as stress rather than diagnosed as a recognised psychiatric illness, the claim can be wrongly confined to the threshold rules.
An experienced personal injury lawyer makes sure your psychological injury is properly assessed by an appropriate specialist, that the diagnosis addresses the classification the scheme applies, and that a decision treating your injury as a threshold injury is challenged where the evidence supports something more serious. We can also make sure your psychological injury is not overlooked alongside physical injuries, where it so often is.
Because a serious psychological injury can affect your ability to work well beyond a single claim, we can also advise on related entitlements, including a Total and Permanent Disability claim through your superannuation. For more on the CTP side, see our guides on pain and suffering compensation and the 10 per cent threshold and on statutory benefits versus common law damages, and you can read about your broader options on our motor vehicle accident claims page. As an Accredited Specialist personal injury firm based in Sydney CBD, with a multilingual team and a No Win No Fee approach for eligible matters, we can review your situation with care and tell you where you stand.
No lawyer can promise you a particular outcome, and every claim turns on its own medical evidence. What can be said is that a psychological injury after a car accident is a real injury, that conditions like post traumatic stress disorder and major depression are more than threshold injuries, and that these claims deserve to be taken seriously.
Speak with an experienced motor accident lawyer today
If you are struggling psychologically after a car accident in New South Wales, whether or not you were physically hurt, your injury may be more than a threshold injury, and it is worth understanding your entitlements.
Contact Stephen Young Lawyers today for a free, no obligation consultation. Call us or get in touch through our website to speak with an experienced personal injury lawyer about your situation and your options.