6.4.1 Compensation Recovery in Specific Circumstances
This section contains general information on the following aspects of compensation recovery:
- compensation settled where the compensation claimant has died,
- recovery where couples separate,
- compensation paid overseas, and
- recovery of disability support and special needs disability WP.
Compensation settled where the compensation claimant has died
Compensation notices can only be served on living persons or insurers of compensation payers who are liable to pay people, not estates. However if a valid notice has been issued prior to the death of a compensation claimant the compensation recovery provisions DO apply for either a settlement of a lump sum or periodic payment.
Example 1: The person had a motor vehicle accident on 17/02/15 and died on 4/07/15. The insurer contacted Centrelink on 6/07/15 and a preliminary notice was issued on 17/07/15. The death was notified on 28/08/15. The preliminary notice is void as it was issued after the person had died and therefore no Part 3.14 recovery is possible. If any compensation is paid, debt recovery may proceed against the deceased's estate under SSAct Chapter 5.
Example 2: The person was injured at work on 7/07/15 and died 16/08/15. A preliminary notice was issued on 11/07/15. A lump sum settlement was made on 17/08/15. Recovery action can be taken against the insurance company under sections 1184D and section 1184H as the notice was issued before the person died.
Where the compensation provisions do not apply, debt recovery may proceed against the deceased's estate under Chapter 5 of the SSAct.
Act reference: SSAct Part 3.14 Compensation recovery, Chapter 5 Overpayments and debt recovery
Recovery where couples separate
Where a couple separate, the impact of the compensation provisions is to be assessed on the couple status of the compensation recipient at the time the compensation is received.
Note: There may be an effect on partners for lump sum payments made before 20 March 1997, as prior to this date partners were subject to preclusion periods.
Policy reference: SS Guide 6.4.3 Recovery Rules Specific to Lump Sums
Compensation paid overseas
Debts are recoverable from the compensation claimant IF they:
- arise as a result of compensation payments awarded or settled overseas, OR
- are made from an overseas source.
In these situations recovery must be made from the compensation claimant. This is because recovery notices can only be served on insurers and compensation payers in Australia.
Act reference: SSAct section 17(2) Compensation, Part 3.14 Compensation Recovery
Recovery of disability support & special needs disability support WP
Disability support wife pension and special needs disability support wife pension are CAPs and are subject to the rules for direct deductions and compensation lump sum preclusion periods. However, the compensation recovery provisions of Division 4 of Part 3.14 DO NOT ALWAYS apply to these 2 groups. The following table explains how the CAP is affected for the pension recipient and their partner.
|If…||Then the CAP…|
|the PARTNER of the wife pensioner is the compensation recipient,||is recoverable if:
|the WIFE PENSIONER is the compensation recipient,||
is not recoverable if:
This means that although DSP, WP and special needs disability support wife pension may be a CAP, compensation recovery is subject to the qualifications above.
Act reference: SSAct section 17(1)-'Compensation affected payment', section 1161(7) Application of Part