IME and permanent impairment assessments in NSW after 1 July 2026

An insurer IME may address diagnosis, causation, treatment, capacity or permanent impairment and is governed by the section 119 framework and Part 7 of the SIRA Guidelines. Its report may inform an insurer decision, but it is not automatically the statutory permanent impairment outcome.

A permanent impairment assessment applies the NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment after maximum medical improvement. It can affect section 66 compensation and statutory thresholds or periods. The assessor must be listed by SIRA for the relevant body system.

It is presently inaccurate to describe the future Division 2 joint Principal Assessment process as already operating.

Until mid-2027, the worker and insurer can continue arranging separate examinations. Before being seen by a permanent impairment assessor, the worker must receive independent legal advice about the full legal implications of the assessment, including compensation consequences and whether financial advice should be considered.

An assessment made during the interim period by an assessor on SIRA’s current register, using the current NSW permanent impairment Guidelines, is an interim period assessment and is taken to be the worker’s principal assessment. It is not to be made while liability for the injury remains undetermined.

If the parties reach an impairment agreement, it should record the degree of impairment, any previous-injury or pre-existing-condition proportion, relevant hearing loss details, permanence, ascertainability, the injury and date, reports relied on, entitlement consequences and confirmation of independent legal advice.

If an interim assessment does not result in agreement, the insurer must notify the worker of its decision not to enter an impairment agreement. Either party may then apply to the Personal Injury Commission for the matter to be dealt with as a medical dispute. The party bringing the dispute must provide medical evidence supporting its position.

This is different from asking another doctor for a second opinion without regard to the new single-assessment rules. The claim history, existing assessments and transitional status should be checked before another assessment is arranged.

During the interim period, a second or later assessment generally requires the worker and insurer to agree that the condition appears to have unexpectedly and materially deteriorated by at least 10 percentage points since the last assessment. At the time of the last assessment there must have been no reasonable cause to expect the deterioration, and age-related deterioration is excluded.

For example, a previous 25% assessment would require evidence supporting at least 35% and the other statutory conditions. The arithmetic alone is not enough. SIRA describes a 21-day insurer response to a worker request as best practice, not as a guarantee that the request will be approved.

Where one or more qualifying pre-reform impairment assessments exist, the most recent may be treated as the principal assessment for relevant entitlements. An assessment that declined to assess because maximum medical improvement had not been reached is not a pre-reform impairment assessment for this purpose.

No new section 66A complying agreements can be entered from 1 July 2026. A worker whose degree of permanent impairment was assessed or agreed before 1 July 2026 but who has not made the section 66 claim must generally make that claim before 1 July 2028 under the transitional rules. Individual status should be checked rather than assumed.

SIRA states that these permanent impairment reforms do not apply to exempt workers—police officers, paramedics and firefighters—coal miners, volunteers, dust-disease claims or claims with a pre-2002 injury date. Those matters may use different rules. The ordinary Part 7 IME rules also contain scheme-specific qualifications that should be checked against the worker category.