What insurances are required when buying a car?
2 Answers
There are three mandatory insurances when purchasing a car: 1. Compulsory Traffic Insurance; 2. Third-party Liability Insurance; 3. Vehicle Damage Insurance. Below are introductions to these insurances: 1. Compulsory Traffic Insurance is a state-mandated insurance. If not purchased, traffic police can impose fines upon inspection. This insurance offers limited compensation, mainly covering others and not the policyholder's own vehicle; 2. Third-party Liability Insurance covers compensation for injuries or direct property damage to third parties (excluding the driver and passengers) in an accident, as stipulated by the insurance company. If the other party is fully at fault, the insurance company provides full compensation. If the policyholder is fully at fault, the insurance company has a 20% deductible; 3. Vehicle Damage Insurance compensates the policyholder. New drivers are prone to minor scrapes and scratches, and purchasing this insurance can help reduce personal losses.
When I first bought my car, I spent a long time figuring out the insurance. Compulsory insurance is a must—it's required by law, and you can't even register your car without it, so don't skimp on this. I opted for a medium coverage amount for third-party liability insurance, as hitting someone or another car by accident could lead to unaffordable compensation. I also added car damage insurance—repairing scratches on a new car is expensive, and filing a claim saves hassle. Passenger liability insurance is essential to cover medical expenses for family or friends in case of an accident. Lastly, I chose a no-deductible add-on to reduce out-of-pocket costs. I also considered flood insurance, as urban areas are prone to waterlogging during rainy seasons. Overall, don’t just go for the cheapest option; pick a reputable company and choose premiums based on your budget and risk tolerance.
