If you’re a driver in New South Wales (NSW), understanding Compulsory Third Party (CTP) insurance—commonly known as a CTP green slip—is essential. Not only is it a legal requirement, but it also provides critical protection for others on the road in the event of a motor vehicle accident.
This guide will break down everything you need to know about CTP insurance, from its coverage and premiums to filing claims and ensuring compliance with the NSW CTP scheme.
- What is CTP insurance?
- What Does CTP Insurance Cover?
- What’s the Difference Between CTP and Comprehensive Car Insurance?
- How the NSW CTP Scheme Works?
- How are NSW CTP Premiums Calculated?
- How to Purchase CTP Insurance
What is CTP insurance?
Compulsory Third Party (CTP) is compulsory third party insurance, commonly known as a “green slip,” and is a mandatory requirement for all vehicles registered in New South Wales. Regulated by the State Insurance Regulatory Authority (SIRA), this insurance specifically covers injuries to third parties—other drivers, passengers, pedestrians, or cyclists—when you’re at fault in a motor vehicle accident.
Unlike in some Australian states, NSW requires you to purchase CTP separately before completing your vehicle registration. It’s crucial to understand that CTP does not cover vehicle or property damage, nor does it typically cover your own injuries as the at-fault driver.
With premiums varying based on driving history, vehicle details, location, and fund levy contributions, CTP ensures accident victims receive compensation for medical expenses, rehabilitation costs, and lost income.
What Does CTP Insurance Cover?
Many drivers wonder: What does CTP insurance cover? Here’s a simple breakdown to help you understand:
Covered by CTP Insurance
- Injuries sustained by third parties, such as pedestrians, cyclists, passengers, or other drivers, in a motor vehicle accident caused by your vehicle.
- Lifetime care for catastrophic injuries like spinal cord damage under the NSW Government’s Lifetime Care and Support Scheme ensures ongoing medical and rehabilitation support.
- Ambulance services and emergency medical treatment for injured third parties.
- Rehabilitation costs, including physiotherapy, counselling, and mobility aids.
- Compensation for lost income during recovery for injured third parties.
- Limited benefits for at-fault drivers, including reasonable and necessary treatment and care costs for up to 12 months under the reformed NSW CTP scheme.
Not Covered by CTP Insurance
- Damage to vehicles or property (this requires third-party property damage insurance or comprehensive car insurance).
- Full compensation for injuries sustained by the at-fault driver (only limited benefits are provided).
- Vehicle towing or repair costs following an accident.
It’s important to note that a valid CTP green slip is required to register your vehicle in NSW. Whether you’re a seasoned driver or a learner driver, this mandatory insurance ensures that victims of motor accidents receive compensation for reasonable and necessary treatment, rehabilitation, and lost wages.
But pairing your CTP policy with comprehensive car insurance is highly recommended for full protection, as comprehensive coverage includes vehicle damage, theft, and third-party property damage.
What’s the Difference Between CTP and Comprehensive Car Insurance
While both policies are vital, they serve different purposes:
| CTP Insurance | Comprehensive Car Insurance |
| Required by law | Optional but recommended |
| Covers personal injury liability | Covers vehicle damage, theft, fire, etc. |
| Required before vehicle registration | Purchased separately |
For example, if you cause a car accident here, your CTP green slip covers the other party’s medical expenses from their motor accident injuries, while your comprehensive policy covers their vehicle repairs.
How the NSW CTP Scheme Works?
The NSW CTP scheme, regulated by the State Insurance Regulatory Authority (SIRA), requires CTP purchase before vehicle registration. Unlike some states where CTP is bundled with registration, in NSW, it’s a prerequisite.
To register your vehicle in NSW, you’ll need:
- Your NSW driver licence number or NSW photo card number
- Vehicle details (e.g., registration number, engine number, chassis number)
- Payment for your CTP premium and registration fees
The Service NSW portal simplifies this process by electronically linking your green slip online to your registered vehicle’s identification number. Whether you own a light vehicle or have learner drivers using your car, all registered vehicles must have valid CTP insurance to legally operate on NSW roads. Failure to maintain proper CTP coverage can result in demerit points and significant penalties.
How Are NSW CTP Premiums Calculated?
Contrary to popular belief, NSW CTP premiums are not fixed; they vary based on several factors:
To register your vehicle in NSW, you’ll need:
- Premium variation. NSW CTP premiums are indeed not fixed and vary based on risk factors. The State Insurance Regulatory Authority (SIRA) confirms that “insurers may have different views on risk costs and may use different rating factors,” resulting in premium variations across insurers.
- Driving history impact. Both SIRA and insurance providers confirm that driving history, demerit points, serious driving offences (like drunk driving), and claims history directly affect premium calculations.
- Vehicle details consideration. The vehicle’s age, type (light vehicle vs. heavier vehicles), and usage (private vs. commercial) are legitimate rating factors used by insurers. The search results confirm that older vehicles may present different risk profiles due to safety features.
- Location influence: Location-based pricing is confirmed, with insurers examining “historical data on accidents, thefts, and natural disasters” in your area. Urban areas with higher accident rates typically result in higher premiums.
- Fund levy. The Fund Levy is a separately applied fee in NSW that varies based on vehicle type and garaging location. It does indeed support the Lifetime Care and Support Scheme for those with severe injuries.
- Comparison tools. As recommended, Service NSW’s Green Slip Price Check tool and insurer websites are legitimate methods for comparing quotes.
How to Purchase CTP Insurance
Gather Documents:
- NSW driver’s licence/photo card number
- Vehicle details (registration number, VIN, engine/chassis numbers)
- For light vehicles over 5 years: eSafety check (pink slip)
Compare Quotes:
- Use Service NSW’s Green Slip Price Check tool
- Premiums vary by driving history, learner drivers, and vehicle type
Apply Online:
- Submit details and pay online (TfNSW notified in 1 hour for card payments)
- Business owners: Claim GST input tax credit for commercial vehicles
- First-time registration? Requires a 12-month CTP policy
Verify Registration:
- Confirm electronic linking via Service NSW
- Unregistered vehicle? Obtain a blue slip and follow TfNSW steps
Penalties:
- Driving unregistered: $697 fine, demerit points, and no CTP coverage
Final thoughts
Staying updated about NSW CTP insurance in 2025 requires understanding its role in protecting third parties and complying with SIRA regulations. Premiums reflect vehicle details, driving history, and location, while the Fund Levy supports critical services like lifetime care.
Remember to always pair your Green Slip with comprehensive car insurance for full coverage. Use Service NSW tools to compare premiums and claim GST input tax credits for commercial vehicles.
Driving an unregistered vehicle risks penalties and voids coverage—stay compliant to safeguard yourself and others on NSW roads. Safe travels!
