Making a pothole damage claim

If your car has come off worse in an unwanted fight with a pothole, you could be entitled to compensation. But making a pothole damage claim is not a simple process.

It is natural to think that the authority or landowner responsible for maintaining the road or area should be responsible for the damage, and foot at least some of the repair bill.

But the onus is generally on you to prove negligence. You must demonstrate that whoever manages the road or site knew, or reasonably should have known, about the hazard and did not fix it in a timely manner.

This is a hard test to meet, with most compensation claims hitting a dead end. In Victoria, of the 1709 claims made for hazards on roads in 2023 and 2024, only 23 resulted in a settlement.

Lisa Dawson was one of the unlucky ones. She hit a pothole on a council-owned road in Melbourne and was quoted $2600 to fix damaged rims and tyres. Rather than be compensated, she was told the council had met its requirement to inspect and undertake repairs under an approved road management plan.

Where do you make the claim?

When you’re trying to get compensation for a hefty repair bill, you do not want to waste time sending it to the wrong authority.

Local roads are typically managed by councils, while major highways and freeways usually fall under the remit of the state road authority, such as Transport for NSW, the Department of Transport and Planning in Victoria, and Main Roads Western Australia.

 

 

If you hit a pothole in a commercial car park or strata complex, your claim will need to be sent to the company or person responsible for the management of the land.

Prior knowledge is key to the claim. Under Victoria’s Road Management Act and NSW’s Civil Liability Act, for example, a road authority is generally protected from liability unless it was already aware of the hazard and failed to act. If you have already reported the pothole, hold onto any reference number, email or other acknowledgement that you have done so.

Will insurance cover pothole damage?

Comprehensive car insurance usually treats pothole damage as accidental damage, so you should be covered. Weigh up the cost of repairs against losing your no-claim bonus or paying the excess, however, as it may not be worth it if the bill isn’t too much more than your excess. If you only have third-party insurance, you will not be covered.

Lodging a claim with your insurer will be faster and more likely to result in a successful outcome than pursuing a council, state authority or private landlord. Check how long you have to lodge a claim before the window closes.

Your insurer may try to recover its losses from the authority or landowner if negligence can be shown, but this is separate to your insurance claim.

 

 

What evidence do you need to provide?

Before you make a claim make sure you have all the following details:

• • Clear photos of the pothole, surrounding road or carpark
  • Clear photos of the damage to your vehicle
  • The location, date and time of the incident
  • A mechanic’s report itemising the damage
  • Repair invoices or quotes
  • Proof of any earlier reports of the hazard

If your claim is rejected, ask for the reasons in writing. Councils and state authorities are required to assess claims against specific legal tests. Knowing which one you failed helps determine whether it is worth pushing back with more evidence, such as proof the hazard had already been reported some time before your accident.

If a council or state road authority has mishandled the process, your state Ombudsman can look into how the claim was handled.

If your own insurer has knocked back a claim for pothole damage that you believe should be covered, ask for a review with the insurer’s complaints department first. The next step is to ask the Australian Financial Complaints Authority (AFCA) to review the decision.

For an issue with a private landowner, such as a shopping centre, you can take them to your state tribunal or local court, though the dollar thresholds and process vary from state to state.

 

 

Is making a pothole damages claim worth it?

As you have already read, the success rate of pothole damage claims against those responsible for maintaining roads is very low. The President of Local Communities Victoria, Tom Humphries, said that the state's compensation system was deliberately designed to only pay out over $1681 of damage.

“By the time you’ve blown out one tyre, maybe two, you’re probably at $2000 damage, which sadly is a massive out-of-pocket expense for damages caused by roads which motorists have paid rego and additional taxes for,” he said.

Australians are entitled to safe conditions on their roads and in carparks. If nothing else, making a complaint to the body responsible for maintenance elevates the issue in the public eye and helps encourage more people to come forward. This, in turn, can put pressure on authorities to do their job and spend the money to ensure our roads are safe.

As is evident in Victoria, potholes and the state of the roads in general have become a hot issue ahead of the election in November, with political parties promising to spend millions to fix them. Speaking up and sharing your experience ensures these problems are addressed and protects other drivers into the future.