What Does Compulsory Traffic Insurance Cover?
2 Answers
Compulsory traffic insurance covers: Any losses caused to a third party (excluding the insured vehicle and its passengers), regardless of fault, fall within the scope of compulsory insurance compensation. The types of insurance that can be purchased for a vehicle include: 1. Compulsory Insurance: This is a mandatory insurance required by the state for vehicles. Without it, a vehicle cannot legally operate on the road. 2. No-Deductible Insurance: This is an additional insurance that can be attached to other commercial insurance policies. If the vehicle owner does not purchase no-deductible insurance, they will be responsible for the deductible portion. 3. Vehicle Damage Insurance: This insurance primarily protects the owner's own vehicle. The cost is based on the vehicle's value, generally, the higher the vehicle's price, the higher the insurance premium. 4. Third-Party Liability Insurance: This insurance also compensates others. In the event of an accident, compulsory insurance is used first for compensation, and any amount exceeding the compulsory insurance coverage is then covered by third-party liability insurance.
I just got my driver's license and bought a car, only to realize that compulsory traffic insurance is a legally required coverage that can't be skipped. It mainly protects victims in accidents, not my car or my own injuries. For example, if I accidentally hit someone while driving, this insurance will cover the other party's personal injury costs, such as medical expenses, emergency fees, and even death compensation and funeral expenses in unfortunate cases. The maximum payout per person is about 118,000 yuan. It also covers some property damage, up to 12,000 yuan, like damaging someone else's vehicle. However, the coverage limits aren't high, so for major accidents, you'd need commercial insurance as a supplement. The annual premium is only a few hundred yuan—cheap and practical. Last time, my neighbor had a minor scrape, and this insurance saved them a lot of out-of-pocket hassle. I think it's a good government design to ensure everyone takes some responsibility while driving and avoids disputes over inability to pay. Overall, it's quite worthwhile, and car dealerships usually arrange it when you buy insurance.
