What are the main types of car insurance to purchase?
2 Answers
Vehicles generally require compulsory traffic insurance and commercial insurance. Commercial insurance includes vehicle damage insurance, third-party liability insurance, and no-deductible coverage. Below are the relevant details: 1. Compulsory Traffic Insurance and Vehicle Tax: This is the minimum standard insurance required for a vehicle to be legally driven on the road, and it is mandatory by the state. It is not collected by insurance companies. Its coverage includes any losses caused to a third party (excluding the insured vehicle and its passengers), regardless of fault, with a maximum compensation amount of 2,000 yuan. 2. Vehicle Damage Insurance: This is the most basic coverage to protect your own vehicle from damage. For example, accidents like hitting a utility pole or hail damaging the car, as well as losses caused by natural disasters, are covered under vehicle damage insurance. However, it is important to note that losses caused by earthquakes are not covered by insurance companies. 3. Third-Party Liability Insurance: This is arguably the most worthwhile insurance to purchase for a vehicle. If you are fully at fault, such as damaging someone else's car or accidentally hitting a pedestrian, the resulting vehicle repair costs and medical expenses for the injured party are all covered by third-party liability insurance. 4. No-Deductible Coverage: By purchasing this coverage, you can transfer the 5% to 20% of the liability that would normally be your responsibility to the insurance company in the event of an accident. However, no-deductible coverage can only be purchased as an add-on to a 'primary insurance' and cannot be bought separately.
I've been driving for over ten years and always carefully select my insurance. First, there's compulsory traffic insurance, which is a mandatory requirement, just like a vehicle's ID card. The most crucial part of commercial insurance is third-party liability coverage. With so many luxury cars and pedestrians on the road now, I directly opted for 3 million in coverage. Vehicle damage insurance is also essential, covering repairs for both minor scratches and major accidents. For passenger liability insurance, I recommend at least 10,000 in coverage—it provides peace of mind when carrying family or friends. Additionally, I added non-medical insurance coverage, which costs just a few dozen bucks but is very practical; otherwise, you'd be out of pocket for self-paid medication in case of an accident. Remember, insurance companies often offer renewal discounts, so be sure to compare prices in advance.
