Victorian drivers face uphill battle for compensation for damage on pothole-riddled roads
Updated . First published at
The Victorian government has vowed to review its pothole compensation scheme following revelations a staggeringly low number of drivers have successfully applied for a refund.
Just over 1800 drivers applied for compensation to Victoria’s Department of Transport over the last two years for damage caused by potholes on state-managed roads.
One of the potholes that caused damage to dozens of cars on Monday. Joe Armao
Of these motorists, only 23 received any money back – a strike rate of just two per cent.
The data was released to the public after Stonnington councillor Tom Humphries submitted a Freedom of Information (FOI) request to the department.
“People have had their cars destroyed and haven’t received any compensation for it,” Humphries told 9News.
Under Victorian law, there is a mandatory property damage threshold of $1681 for damage caused by hazards like potholes.
If the loss is more than $1681, successful claims will have that amount deducted from any damages.
Anything under this figure won’t be covered.
In a statement to nine.com.au, a Victorian government spokesperson said the compensation legislation was introduced over 20 years ago and that it is “fair to ask whether it still meets Victorians’ expectations”.
“The Carroll Labor government will look at the current legislation, and we’ll consider if we have the balance right,” the spokesperson said.
“But our firm focus is on fixing the roads.”
A pothole seen south of Tallarook in Victoria on the Hume Freeway. Andrew Reilly
“That’s why we have funded a record-breaking $1.04 billion road maintenance blitz to rebuild, repair, and resurface roads right across the state to get Victorians home sooner and safer.”
The Department of Transport said it repaired 266,000 individual potholes in 2025.
Countless drivers have been forced to pull out their own wallet and cover costly damage caused by crumbling roads in the state.
A1 Tyrepower Wangaratta owner and operator Harrison Coatsworth told 3AW he often needs to break the news to car owners about the compensation threshold.
“It’s ridiculous. It should be lower because a lot of the time when we’re not having suspension trouble, it’s purely just rim and tyre related, and if it’s just one, it’s not up around that $1600 mark,” Coatsworth said.
“So people are missing out. It’s really frustrating.”
It comes just days after nearly 40 drivers suffered damage to their tyres and rims after driving through potholes on the Princes Highway near the town of Bunyip, south-east of Melbourne, on Monday.
Under Victorian law, there is a mandatory property damage threshold of $1681 for damage caused by road hazards. Justin McManus
A part of Murray River Road in north-eastern Victoria was littered with potholes. Simoen van der Meent
The incident caused major peak-hour delays as commuters headed to Melbourne.
The Princes Highway is a state-managed road.
New Victorian Premier Ben Carroll vowed to fix Victoria’s crumbling highways following the pothole chaos and said he had hired a civil engineer into the state’s roads portfolio.
“We need to make sure when we fix them, we do it properly. And that is why I’m putting a civil engineer in the roads portfolio,” Carroll said.
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