What does third-party liability insurance mean?
1 Answers
Third-party liability insurance refers to a type of auto insurance where the insurer compensates for the financial liability that the insured or their legally permitted drivers must bear under the law, arising from accidental incidents involving the insured vehicle that cause bodily injury, death, or direct property damage to a third party. Since the introduction of compulsory traffic insurance, third-party liability insurance has become a non-mandatory coverage that can serve as a supplement to compulsory insurance. The coverage amount for third-party liability insurance depends on the driving environment. If the car owner lives in a remote area with few vehicles on the road, a coverage of 200,000 yuan may suffice. For car owners in fourth or fifth-tier cities, a coverage of 500,000 yuan is generally adequate.