What are the mandatory insurances required when purchasing a new car?

1 Answers
OLucille
07/30/25 7:02am
National regulations require the compulsory purchase of compulsory traffic insurance. Below is relevant information about compulsory traffic insurance: 1. Compulsory Traffic Insurance: This is a legally mandated insurance in China that every vehicle owner must purchase. It effectively ensures basic insurance claims when traffic accidents occur. 2. Financial Compensation: In the event of a traffic accident, compulsory traffic insurance can cover difficult-to-pay financial compensations. Failure to purchase compulsory traffic insurance as required may result in the traffic management authorities detaining the vehicle and imposing a fine of twice the amount of the insurance premium due. 3. Base Premium: If no accidents occur during the insurance period, the renewal premium the following year will decrease by 10% from the base premium, with a maximum reduction of 30%. However, if multiple accidents occur, the premium for the following year may increase, up to a maximum of 30%, or even result in the insurance company refusing coverage.
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