What is Permanent Impairment Compensation?

By Kai Baldwin, Founder of BAC · First published 18 April 2026 · Reviewed against DVA sources on 11 September 2026. See sources

Permanent Impairment compensation is a lump sum payment from DVA for the lasting impact your service-related conditions have on your life. If you've got accepted conditions and haven't looked into PI, you could be leaving serious money on the table.

What is Permanent Impairment?

Permanent Impairment (PI) compensation is a lump sum payment from DVA for the lasting impact your service-related conditions have on your life. It's separate from Initial Liability and it's on top of it. Think of Initial Liability as DVA saying "yep, your condition is service-related." Permanent Impairment is the compensation for how much that condition has affected your day-to-day life.

These can be significant payments. We're talking thousands, sometimes tens of thousands of dollars, depending on the severity of your impairment across all your accepted conditions.

Who is Eligible?

Your condition needs to already be accepted by DVA through an Initial Liability claim, and it needs to have reached a point where it's stable. DVA calls this "clinical stabilisation." It's not going to get much better. If that's the case, you may be eligible for a PI claim.

How is it Assessed?

Since 1 July 2026 there is one guide for every PI claim: the Guide to Determining Impairment and Compensation, which everyone calls GARP M. It doesn't matter whether you served in 1985 or 2025. Under the old three-Act system, each Act used a different tool to assess impairment. That's gone. Every new PI claim is decided under the Military Rehabilitation and Compensation Act (MRCA), and GARP M is the only measuring stick.

Here's how it works. A medical assessment rates the impairment from each accepted condition, and those ratings are combined into a whole-of-person figure, measured in impairment points. Points then drive compensation. The more points, the more compensation, up to a maximum weekly rate that DVA publishes and updates on its MRCA rates page. You can take that as a weekly amount paid fortnightly, convert it to an age-based lump sum, or do a mix of both.

GARP M also gives you a lifestyle rating, which is a separate score for the effect your conditions have on your life outside the clinic. It matters more than people think. The Additional Disablement Amount for veterans at pension age or older, for example, needs a lifestyle rating of 6 or higher on top of 70 impairment points.

If you've already been paid compensation under the Veterans' Entitlements Act (VEA) or the Safety, Rehabilitation and Compensation (Defence-related Claims) Act (DRCA), the new assessment takes that into account. You don't get paid twice for the same impairment. You get paid for the extra.

Reassessments: Your Conditions Can Change

Here's something a lot of veterans don't realise. If your conditions have worsened since your last PI assessment, you can apply for a reassessment. And it happens more often than people think. Mental health conditions in particular tend to deteriorate over time, especially if you're not getting the right support.

A reassessment can result in a significant additional lump sum. I've seen plenty of cases where veterans were sitting on worsening conditions for years without knowing they could get more compensation.

Since 1 July 2026 a worsening claim is an MRCA claim, no matter which Act your condition was originally accepted under. VEA and DRCA are closed to new claims, and that includes the old VEA Application for Increase. Your accepted VEA and DRCA conditions carry across automatically under section 24A of the MRCA, so you don't have to re-prove them. You claim the worsening. I've covered the full picture in what changed on 1 July 2026.

For PI to be payable on a worsening, GARP M has to find at least 5 more impairment points than you had last time. And if you were only ever assessed under VEA or DRCA, DVA first translates your old rating into a GARP M baseline, then measures the 5 points from there. That baseline only counts the impairment you were compensated for. A VEA percentage does not map neatly onto MRCA points, so don't assume where you'll land until DVA has done the translation.

One more thing that's new for VEA veterans. Compensation for a PI claim lodged from 1 July 2026, including a worsening claim, can be converted to an age-based lump sum. That was never an option under the VEA. Your existing Disability Compensation Payment is grandparented, so it keeps being paid and indexed as normal. But the lump-sum election is final. DVA can't reverse it later, and neither can you.

How BAC Can Help

I handle the entire PI process. Working out if you're eligible, coordinating the medical assessments, preparing the claim, and making sure nothing gets missed. Every condition, every impairment point matters.

And because BAC is fixed fee, there's no percentage cut from your lump sum. What you're owed is yours.

Sources

• Permanent Impairment Compensation (DVA): GARP M as the only assessment tool from 1 July 2026, whole-of-person assessment, translated baseline for DRCA assessments, weekly or lump-sum payment choice, previous compensation taken into account.
• Veterans' Legislation Reform: Frequently asked questions (DVA): section 24A carry-over, the 5 impairment point rule, the translated baseline counting only compensated impairment, lump sum for VEA veterans on new PI claims, the lump-sum decision being final, grandparented payments, ADA lifestyle rating.
• VEA Veterans (DVA): worsening claims replacing the VEA Application for Increase, periodic payments convertible to a lump sum, ADA criteria including lifestyle rating.
• Compensation payment rates for MRCA (DVA): maximum weekly PI benefit published for a stated period and payable as an age-based lump sum.