What Insurance Should You Buy When Paying in Full for a Car?
1 Answers
When paying in full for a car, the following types of insurance are necessary: 1. Compulsory Traffic Accident Liability Insurance (CTPL): CTPL is a mandatory insurance in China, and all vehicles must purchase this coverage. 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 CTPL, the vehicle will lose its eligibility for annual inspection. Therefore, CTPL is essential. 2. Third-Party Liability Insurance: Most car owners opt for both CTPL and third-party liability insurance. Since the compensation amount from CTPL is limited, third-party liability insurance covers the excess amount that CTPL cannot compensate. Even in the event of an accident, you can receive a more reasonable amount of compensation. 3. No-Deductible Insurance: Unlike the first two types of insurance, which are basic and independent, no-deductible insurance is an additional coverage for cars. Its role is that if you incur a claim of 1,000 yuan, the insurance company would normally cover 80% (800 yuan) of the loss. With no-deductible insurance, the remaining 20% you would have to pay is also transferred to the insurance company, meaning you receive 100% compensation. Hence, no-deductible insurance is worth purchasing. 4. Vehicle Damage Insurance: Vehicle damage insurance undoubtedly offers the broadest coverage among necessary insurances. Whether your car suffers from collisions, scratches, water damage, or other harm, you can receive compensation from the insurance company. The final compensation amount depends on various factors such as the cause of the incident and the extent of the damage.
