Lump sum compensation for permanent impairment

If you have a permanent impairment as a result of a workplace injury or illness, you may be entitled to receive a lump sum payment as compensation.

This is in addition to weekly payments and medical and related expenses that may generally be available through the workers compensation system.

The information below is generalised and the payments you receive may vary based on your circumstances.


Claims payments for lump sum permanent impairment compensation made on or after 19 June 2012, including those claims for injuries that occurred on and from 1 January 2002, are based on an assessment of your permanent impairment.

A minimum level of permanent impairment must be present to be eligible for permanent impairment compensation.

The minimum level is greater than 10 per cent permanent impairment, except for primary psychiatric and psychological impairments which require a minimum level of 15 per cent permanent impairment. No permanent impairment compensation is available for secondary psychological injuries.

If you made a claim for permanent impairment before 19 June 2012, you may be entitled to make one further lump sum compensation claim.

Eligibility for exempt categories of worker

You are an exempt category of worker if you are a police officer, paramedic, fire fighter, volunteer bush fire fighter or emergency rescue services volunteer.

Payments for lump sum compensation you may be eligible for are:

  • permanent impairment sustained as a result of a work related injury or illness
  • pain and suffering arising from the impairment.

There is no minimum level of permanent impairment for exempt categories of workers.

Assessment of permanent impairment

The impairment must be assessed by a medical specialist listed on this website as a trained assessor of permanent impairment.

Your injury must have reached maximum medical improvement. This means the workers condition is well stabilised and is unlikely to change substantially in the next year with or without treatment.

Making a claim

A permanent impairment claim form is required unless your claim for weekly and other benefits has already included a claim for lump sum compensation for permanent impairment. If you're an exempt worker you complete the exempt claimant permanent impairment claim form.

The form provides details of the information that must be supplied when making a claim. Only one claim for permanent impairment compensation can be made in respect of the injury.

However workers who made a claim for lump sum compensation before 19 June 2012 can make one further deterioration claim.

If you are an exempt worker, you may be entitled to make more than one lump sum compensation claim

Once the insurer has received the claim for lump sum compensation for permanent impairment, it must within one month either accept liability and make a reasonable offer of settlement or dispute liability.

If the insurer determines that  all the required information has  not been provided about the claim, within two weeks of receiving the claim it must:

  • ask you to supply this information, and/or
  • arrange for a permanent impairment assessor to examine you.

Complying agreement

A complying agreement is a written agreement between you and the insurer regarding the offer of settlement for lump sum payment for permanent impairment and, if eligible, for pain and suffering.

Prior to making the payment for permanent impairment, the insurer must be satisfied that you have obtained independent legal advice or have waived the right to independent legal advice.

The insurer is required to record evidence that this advice has been obtained, or that it has not been obtained, and the details of the agreement.

Benefits for permanent impairment

The maximum lump sum payment for permanent impairment injuries incurred:

  • between 1 January 2002 and 31 December 2006 is $200,000, with an additional five per cent for permanent impairment of the back for injuries on or after 1 January 2006
  • between 1 January 2007 and 4 August 2015 or all exempt worker claims is $220,000 (plus an additional five per cent for permanent impairment of the back)
  • on or after 5 August 2015 is $584,580 (plus an additional five per cent for permanent impairment of the back), this amount is indexed yearly as of 01/07/16 and is not applicable to exempt workers.

View detailed information on benefits for permanent impairment and pain and suffering in the workers compensation benefits guide.

Benefits for pain and suffering

If you are an exempt worker you may also receive an additional lump sum payment for pain and suffering arising from a permanent impairment if you have 10 per cent or more whole person impairment.

For a primary psychiatric and psychological impairment there is a 15 per cent threshold.

The maximum amount payable is $50,000.

Further information


Sometimes there can be disputes about permanent impairment. If there’s a dispute, there’s help available. Our workers compensation disputes section has more information.