Vehicle insurance

Vehicle insurance is insurance for cars, trucks, motorcycles, and other road vehicles. Its primary use is to provide financial protection against physical damage or bodily injury resulting from traffic collisions and against liability that could arise. The specific terms of vehicle insurance vary with legal regulations in each region. To a lesser degree vehicle insurance may additionally offer financial protection against theft of the vehicle and possibly damage to the vehicle.

A compulsory car insurance scheme was first introduced in the United Kingdom with the Road Traffic Act 1930. This ensured that all vehicle owners and drivers had to be insured for their liability for injury or death to third parties . Germany enacted similar legislation in 1939.

Vehicle insurance

Vehicle insurance Public policies

Many jurisdictions made a compulsion to have Vehicle insurance before the motor vehicle comes on roads. Most jurisdictions relate insurance to both the car and the driver, however the degree of each varies greatly.


In Australia, Compulsory Third Party (CTP) insurance is a state-based scheme that covers only personal injury liability. All Comprehensive and Third Party Property Damage insurance are sold separately.

  • Comprehensive insurance covers damage to third-party and the insured property and vehicle.
  • Third Party Property Damage insurance covers damage to third-party property and vehicles, but not the insured vehicle.
  • Third Party Property Damage with Fire and Theft insurance additionally covers the insured vehicle against fire and theft.


Several Canadian provinces  provide a public Vehicle insurance system while in the rest of the country insurance is provided privately. Third party insurance is privatized in Quebec and it is mandatory. The province covers everything but the vehicle(s). Basic auto insurance is mandatory throughout Canada with each province’s government determining which benefits are included as minimum required auto insurance coverage.


Third-party vehicle insurance is mandatory for all vehicles in Hungary. No exemption is possible by money deposit. Vehicle insurance policies from all EU-countries and some non-EU countries are valid in Hungary based on bilateral or multilateral agreements.


Third-party vehicle Insurance is a mandatory requirement in Indonesia. Each individual car and motorcycle must be insured or the vehicle will not be considered legal. Third Party vehicle insurance is included through a levy in the vehicle registration fee which is paid to government institution that known as “Samsat”.


Auto Insurance in India deals with the insurance covers for the loss or damage caused to the automobile or its parts due to natural and man-made calamities. It provides accident cover for individual owners of the vehicle while driving and also for passengers and third party legal liability. There are certain general insurance companies who also offer online insurance service for the vehicle.

Auto Insurance in India is a compulsory. The insurance companies have tie-ups with leading automobile manufacturers. They offer their customers instant auto quotes. The claims of the Auto Insurance in India can be accidental, theft claims or third party claims. Certain documents like duly signed claim form, RC copy of the vehicle, Driving license copy, FIR copy, Original estimate and policy copyare required for claiming Auto Insurance in India.

There are different types of Auto Insurance in India :

Private Car Insurance. – In the Auto Insurance in India, Private Car Insurance is the fastest growing sector as it is compulsory for all the new cars. The amount of premium depends on the make and value of the car. State where the car is registered and the year of manufacture.

Two Wheeler Insurance. – The Two Wheeler Insurance under the Auto Insurance in India covers accidental insurance for the drivers of the vehicle. The amount of premium depends on the current showroom price multiplied by the depreciation rate fixed by the Tariff Advisory Committee at the time of the beginning of policy period.

Commercial Vehicle Insurance. – The amount of premium depends on the showroom price of the vehicle at the commencement of the insurance period, make of the vehicle and the place of registration of the vehicle. The auto insurance generally includes. :

  • Loss or damage by accident, fire, lightning, self ignition, external explosion, burglary, housebreaking or theft, malicious act.
  • Liability for third party injury/death, third party property and liability to paid driver.
  • On payment of appropriate additional premium, loss/damage to electrical/electronic accessories.

The auto insurance does not include:

  • Consequential loss, depreciation, mechanical and electrical breakdown, failure or breakage
  • Any vehicle used outside the geographical area
  • War or nuclear perils and drunken driving.

United States

The regulations for vehicle insurance differ with each of the 50 US states and other territories. With each U.S. state having its own mandatory minimum coverage requirements. Each of the 50 U.S. states and the District of Columbia requires drivers to have insurance coverage for both bodily injury and property damage. But the minimum amount of coverage required by law varies by state.

Most states require a motor vehicle owner to carry some minimum level of liability insurance. States that do not require the vehicle owner to carry car insurance include Virginia. New Hampshire, and Mississippi which offers vehicle owners the option to post cash bonds in each respective state when traveling to another.

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