What insurance policies are generally required for a new car?
1 Answers
New cars require the following insurance policies: 1. Compulsory Traffic Accident Liability Insurance (CTPL), which is mandatory and required for vehicle registration. CTPL covers compensation for others, but the coverage amount is relatively low; 2. Vehicle Damage Insurance, which is also very important. If you accidentally collide with another vehicle, this insurance can cover the repair costs; 3. Third-Party Liability Insurance, another essential auto insurance policy. You can choose different coverage amounts for this, such as 200,000, 300,000, 500,000, or 1,000,000. The coverage amount represents the maximum compensation limit. For example, if you purchase 200,000 in third-party liability insurance, the maximum compensation in the event of an accident is 200,000. If the damages exceed this amount, the car owner must cover the difference. Naturally, higher coverage amounts result in higher premiums; 4. Scratch Insurance, an add-on to Vehicle Damage Insurance, covers malicious acts by others that cause scratches on the insured vehicle. The premium for Scratch Insurance is not high, but due to the high claim rate for vehicle scratches, some insurance companies stipulate that, except for new cars, used cars must have no more than two claims in the previous year. If there is one claim, the compensation amount cannot exceed 30% of the premium, and the insured vehicle must be no older than five years; 5. Passenger Liability Insurance, which compensates for injuries or fatalities to drivers and passengers in the event of an accident.
