A paramedic who was killed during a cliff rescue on the NSW south coast was inadvertently dragged off a cliff ledge by a rescue helicopter that was meant to winch him and his patient to safety, a report into the accident has found.

Light was fading quickly at Carrington Falls, near Wollongong, on Christmas Eve in 2011 as special rescue paramedic Michael Wilson attempted to rescue an injured canyoner from a waterfall known as Bridal Veil Falls.

Mr Wilson, 42, had abseiled down to the injured canyoner, who had set off an emergency personal locator beacon earlier that afternoon after falling from the top of the cliff.

Mr Wilson had planned for his patient and himself to be winched into the helicopter as it hovered near the cliff ledge, about 15 metres from the base of the waterfall.

But a report into the accident, released on Thursday by the Australian Transport Safety Bureau (ATSB), found that the air crewman on board the helicopter was unable to see all of the winch cable clearly in the fading light before commanding the helicopter to move upwards just after 8.30pm.

While the air crewman believed he had received a hand signal from Mr Wilson indicating that he and the patient were ready to be winched, that in fact was not the case.

"The result was that the injured canyoner and duty paramedic were unintentionally pulled from the ledge," the report found.

"Given the low light conditions that existed at the time of the winch, it is possible that the ACM [air crewman] may have misinterpreted the duty paramedic's movement in preparing a stabilising rope as an indication that he was ready to be lifted."

Mr Wilson and his patient were pulled off the cliff and plunged about 15 metres onto a large rock at the base of the waterfall.

The injured canyoner told the investigators that he and Mr Wilson were tangled in rope when they came to rest in the water.

The injured canyoner helped the paramedic to remove his harness and equipment before a support paramedic arrived. However Mr Wilson died of his injuries a short time later.

A trauma surgeon found that Mr Wilson had died from internal bleeding due to fractures in his pelvis.  He was the first NSW paramedic to have died on duty in 30 years.

The canyoner suffered a fractured lumbar vertebra.

The ATSB report said that it had identified several safety issues relating to training and use of the helicopter's lighting and radios.

"A number of organisational issues that could adversely influence the way crews act in similar circumstances were also identified," the report said.

One of those was that the rescuers had decided to use a self-stabilising rope system anchored to a secure point, a procedure for which the crew had not been trained and which was not documented by the NSW Ambulance Service.

Such a rescue had never been undertaken by its staff, the Ambulance Service of NSW said.

The ATSB said the ambulance service had since specifically banned the use of such techniques, and had incorporated the ban into the its operations manual.

"In addition, paramedics, in their role as ambulance rescue crewmen, are now required to conduct annual night winching currency training," the report said.

"Finally, proactive safety action was taken by these parties in the areas of general crew training and operational risk assessment."

The injured canyoner spent the night at the base of the waterfall with rescuers and was taken to hospital on Christmas Day.

Mr Wilson's widow has since launched a campaign to make it easier for people in her husband's job to get income protection and life insurance.

Kellie Wilson and the NSW Health Services Union are separately lobbying the NSW government to ensure that other families are not left in a financially difficult position after a similar death.

The union said that while life insurance and income protection is readily available to paramedics, it is either not offered by some insurance companies or prohibitively expensive for special rescue paramedics such as Mr Wilson.