Failure to take out insurance

If you own a registered car, employ people (with some exceptions), or work on residential building projects worth over $20,000, you must take out an insurance policy.

This provides cover if someone is injured after an accident or suffers a financial loss. If you don’t purchase an insurance policy, you could be liable for heavy penalties and even jail.

What happens if I fail to take out CTP insurance?

You will need to take out CTP insurance (by purchasing a Green Slip) to register your vehicle. Driving an unregistered motor vehicle can be a crime, punishable by loss of vehicle registration and fines.

If you don’t have CTP insurance and you are involved in an accident where your vehicle was at fault, you could receive heavy fines and be liable for the costs incurred by the other driver. The severity depends on whether someone was seriously hurt or killed.

If you do hurt someone you could also be held liable to repay the cost of compensation made by the insurer to the injured person.

In instances where you weren’t aware the insurance had lapsed on your motor vehicle (or on somebody else’s motor vehicle you were driving) you could still be liable for a hefty fine if the police pull you over. This can amount to an on the spot fine and additional penalties if the matter goes to court.

Even if you have CTP insurance but you haven’t yet registered your car – your CTP insurance is not valid until your registration is processed.

Get a policy

The best approach is to purchase your Greenslip and register your car before the date of expiry to avoid any length of time between re-insurance where your previous registration and insurance lapses.

Make sure you know when your expiry date is approaching: go online and visit Service NSW to conduct a free rego check.

Find a CTP insurer and purchase your policy using our Greenslip calculator.

Don’t forget to do your required inspections before you register your motor vehicle through Service NSW.

What happens if I fail to take out workers compensation insurance?

If an employer fails to take out workers compensation insurance, they could receive a ‘double avoided penalty’ (and/or jail time if someone is injured at work).

A double avoided penalty is like a fine that constitutes double the amount of insurance you failed to pay and can have a significant effect on your business and finances.

Non-insurance not only poses risks to the safety of workers who need to be compensated should an injury occur, it is considered a financial advantage, meaning businesses doing the right thing are impacted by those in their industry who make financial gains by failing to cover their workers.

Operating while uninsured creates a risk to a business, its workers and the fairness of the system.

SIRA’s role is to identify and collect evidence in order to prosecute a case, but it is the courts that determine the penalty outcomes of a prosecution.

Our investigation and enforcement team identify un-insured employers via injury claims and enquiries, anonymous tips, data auditing and cross referencing with other agencies.

We also carry out proactive visits to small businesses to educate employers on their workers compensation obligations.

Get a policy

See our how to get workers compensation insurance page for information on how to take out an insurance policy, what you need to take into consideration, and how we can help.

Employers also have other workers compensation obligations. Learn about them through the handy online tool, Small Business Assist, or our webpage, After getting workers compensation – what next?

What happens if I fail to take out home building insurance?

Building and trades contractors must take out insurance under the home building compensation fund for each residential building project if the contract price is over $20,000, inclusive of GST (with some exceptions).

If not they could be liable for financial penalties up to $110,000 for the first offence and $55,000 and/or a maximum of 12 months imprisonment or both for second or subsequent offences.

Homeowners need to be covered in case their contractor is unable to finish a project, or cannot fix defects due to the builder dying, becoming insolvent or disappearing.

In the home building industry, NSW Fair Trading regulates builder's compliance with insurance requirements.  Both homeowners and insurers can report fraud, uninsured or under-insured work  to NSW Fair Trading, which will address the matter through their complaints assessment process. As a result of the complaint, NSW Fair Trading may then undertake an investigation.

You can find out more on the Fair Trading website.

Get a policy

Insurance under the home building compensation fund is currently provided exclusively by the NSW Government’s insurer: icare.

First, you need to obtain insurance eligibility via a broker on icare’s broker panel. A certificate of eligibility means you’ve been assessed as satisfying icare's requirements to undertake work over $20,000 in value, which requires home building compensation insurance.

Once you have eligibility, it entitles you to apply for insurance certificates (also called project certificates). Your eligibility may include limits about the type and amount of work for which you may purchase insurance.

You can find out more on the icare website.

How to report

If you believe someone is doing the wrong thing you can report it.

See preventing fraud for more information