Acting Minister for Finance and Services Andrew Constance said the government would meet with "relevant players" to discuss the legislation after it failed to pass through the upper house.

"We will facilitate further discussion by holding a CTP round-table involving relevant players including accident victims, insurers, lawyers, community and business leaders," Mr Constance said.

"The bill will be further consulted on as a part of this process and a position paper will be released prior to the round-table."

The most controversial part of the government's proposal was the introduction of a "no-fault" scheme, which the government claimed would lead to a reduction in CTP insurance costs.

Under the scheme, NSW motorists injured in car accidents would no longer have to prove someone else was at fault to claim compensation.

President of the Wollongong & District Law Society David Potts argued that a no-fault scheme would reduce the amount of benefits people injured in accidents would receive.

He also said that this would be exacerbated by a reduction in the cost of CTP policies.

Mr Potts, who had been pushing the government to consult with the community on the legislation, said he was pleased with the change of approach.

"We certainly welcome the fact that they're going to see more community involvement and consultation in the process."

He said the changes the government were proposing went too far.

"The problem with the government plan is that they're trying to do two things at once," he said.

"They're trying to introduce a no-fault scheme and they're also trying to reduce premiums. The problem about introducing a no-fault scheme is that many, many more people can claim, and it will be difficult to achieve a premium reduction when there are more people claiming - unless everyone gets a lot less."

Mr Constance did not say whether or not the no-fault component had to be included.

Mr Potts said the NSW Law Society earlier this year put up a plan to the government that addressed reductions in premiums.

"In that plan there would have been changes to the existing system but it would have reduced the average green slip price below $500," Mr Potts said.

"So certainly our local Law Society and the NSW Law Society acknowledge the necessity for some change in those circumstances."