---
title: "Separate NSW section 151Z from a policy subrogation clause"
url: "https://ailawframework.com/practice/insurance-law/map-subrogation-and-contribution-rights-from-the-policy-and-the-loss-fil/new-south-wales"
type: "task_jurisdiction_version"
site: "AI Law Framework"
id: "A22-T1-R5-NSW"
practice_area: "Insurance Law"
tier: "yellow"
lawyer_review: "required"
jurisdictions: ["NSW"]
last_reviewed: "2026-10-25"
---

# Separate NSW section 151Z from a policy subrogation clause

> From the policy and the loss file, table any contractual subrogation or contribution clause, and set out section 151Z only where the lawyer says compensation is payable and a person other than the employer is liable in…

Canonical page: https://ailawframework.com/practice/insurance-law/map-subrogation-and-contribution-rights-from-the-policy-and-the-loss-fil/new-south-wales  
Last reviewed: 2026-10-25

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Insurance Law](https://ailawframework.com/practice/insurance-law.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | From the policy and the loss file, table any contractual subrogation or contribution clause, and set out section 151Z only where the lawyer says compensation is payable and a person other than the employer is liable in damages. Do not calculate a repayment. |
| What the lawyer must review | Decide whether a person other than the employer is liable in damages. If not, do not use section 151Z. The worker may pursue both claims and cannot retain both damages and compensation. Check the order of recovery before stating a repayment or an indemnity. Keep medical details in the firm's system. Apply ASCR rule 9, APP 11, and the Privacy Act notifiable-breach test. |
| Written for | New South Wales |
| Applies to | [Map subrogation and contribution rights from the policy and the loss file](https://ailawframework.com/practice/insurance-law/map-subrogation-and-contribution-rights-from-the-policy-and-the-loss-fil.md) |

## Checking plan

**Verify against sources**

The lawyer keeps a policy subrogation clause separate from section 151Z, and applies section 151Z only in the dual-liability case.

- What the AI does: From the policy and the loss file, table any contractual subrogation or contribution clause, and set out section 151Z only where the lawyer says compensation is payable and a person other than the employer is liable in damages. Do not calculate a repayment.
- What the lawyer does: Decide whether section 151Z applies and what, if anything, is repaid or indemnified.
- Who reviews: Lawyer competent in this practice area
- Basis: Checked against the linked sources on 23 October 2026. Confirm the current instrument before reliance.

## Checks the lawyer makes

1. Section 151Z(1) applies where compensation is payable under the Workers Compensation Act 1987 and the injury was caused in circumstances creating a liability in a person other than the employer to pay damages.
2. The worker may take both proceedings and is not entitled to retain both damages and compensation.
3. If compensation is recovered first and damages second, the worker repays the compensation paid and is not entitled to further compensation. If damages are recovered first, the worker is not entitled to compensation under the Act.
4. The person who paid the compensation is entitled to be indemnified by the person liable to pay the damages, and that indemnity is limited to the amount of the damages.

## Notes

- Only subsection (1)(a) to (d) was used. Later subsections, including any motor-accident adjustment, were not applied in this version. A contractual subrogation clause remains a policy question and is not restated as section 151Z.

## Practical guide

Jurisdiction: Workers Compensation Act 1987 (NSW) section 151Z, beside any subrogation clause in a policy

**Deliverable**: A table that separates the policy clause from section 151Z(1). No repayment figure.

**Inputs**

- Policy subrogation and contribution clauses
- Whether compensation is payable under the Workers Compensation Act 1987
- Whether the lawyer says a person other than the employer is liable in damages
- The order of any recovery

**Example**: Illustrative example: A public-liability insurer asks about subrogation after a host employer paid workers compensation and a contractor is also sued. The tool sets out section 151Z(1) only. It does not calculate the repayment, and it does not call the policy clause section 151Z.

**Stop and escalate when**

- The lawyer has not said that a person other than the employer is liable to pay damages.
- The order of compensation and damages is unknown.

Checked 2026-10-23.

## Sources

- [Workers Compensation Act 1987 (NSW) section 151Z](https://www5.austlii.edu.au/au/legis/nsw/consol_act/wca1987255/s151z.html) (checked 2026-10-23)
- [Insurance Contracts Act 1984 (Cth) section 9](https://classic.austlii.edu.au/au/legis/cth/consol_act/ica1984220/s9.html) (checked 2026-10-23)

## Forms and precedents for this task

| Form or precedent | Kind | AI level | Summary |
| --- | --- | --- | --- |
| [Subrogation limits against family and a permitted driver](https://ailawframework.com/precedents/insurance-law/subrogation-limits-against-family.md) | Checklist | Yellow | Checklist of Insurance Contracts Act 1984 section 65, which limits subrogation against a family member or a person allowed to use the insured vehicle. |

Signed-in accounts can read the full text of each one.

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*