What are the types of car insurance?
4 Answers
Car insurance generally includes compulsory traffic insurance and commercial insurance, with the latter consisting of basic insurance and additional insurance. Below is extended information: Compulsory Traffic Insurance: Compulsory traffic insurance is mandatory in China, and all vehicles must purchase this type of insurance. In the event of a traffic accident, the insurance company can only compensate the party that was hit, meaning the conditions for compensation are limited. Additionally, without compulsory traffic insurance, the vehicle will lose its eligibility for annual inspection. Third-Party Commercial Liability Insurance: Most car owners opt for both compulsory traffic insurance and third-party liability insurance. Since the compensation amount from compulsory traffic insurance is limited, purchasing third-party liability insurance can cover the portion that exceeds the compulsory traffic insurance's compensation limit.
When I first bought my car, I also struggled with insurance issues, but now I've got it figured out. Compulsory traffic insurance is government-mandated—you can't drive without it, and it mainly covers others' losses. Commercial insurance depends on your needs: vehicle damage insurance covers your own car's repair costs, and third-party liability insurance is especially important—if you hit a luxury car or injure someone, you really can't afford the compensation without it. Seat insurance covers medical expenses for passengers, and since my family includes elderly and children, I bought it for the whole car. Glass insurance covers broken glass separately, and the no-deductible insurance ensures the insurer pays in full, so you don’t have to cover any part yourself. For a new car, I recommend getting both vehicle damage and third-party liability insurance. For an older car, you can skip the vehicle damage insurance to save a lot on premiums.
Having driven for almost ten years, I believe the key to car insurance lies in the right combination. The compulsory traffic insurance required by the government is a must, mainly covering the other party's injuries and vehicle in an accident. For commercial insurance, I recommend three essentials: vehicle damage insurance for repairing your own car, third-party liability insurance with a suggested coverage of at least 2 million (given the number of luxury cars on the road nowadays), and seat insurance for the safety of your passengers. As for flood insurance, it depends on the region—cities with heavy rainy seasons in the south should consider it. If you've modified your car, remember to register the aftermarket parts with the insurance company; otherwise, they won't cover damages. I adjust my policy every year at renewal, deciding whether to drop coverage like spontaneous combustion insurance based on my car's condition.
Auto insurance actually consists of two parts: compulsory traffic insurance serves as the foundation, while commercial insurance allows for flexible combinations. The most commonly used coverages include vehicle damage insurance (for repairing your own car), third-party liability insurance (covering the other party's losses), and seat insurance (for medical expenses of passengers). For new cars, it's advisable to add glass insurance and scratch insurance, and if the parking environment in your community is poor, theft insurance is also essential. Recently, specialized insurance for new energy vehicles has introduced practical battery protection options. A colleague of mine learned the hard way and reminds everyone that insurance does not cover damage to heated rearview mirrors after rain—you need to purchase additional coverage separately. Nowadays, renewing insurance via mobile apps is very convenient, and you can also compare prices of different plans.
