Hong Kong is renowned for its public transport system, but we still want to drive a car sometimes, like when picnicking with your family on holiday or rushing for work and the public transport is not fast enough. If you are planning to get a car in Hong Kong, then you should also be considering car insurance, and that’s why we are here to give you some introductions.
The Importance of Getting Car Insurance in Hong Kong
Every car owner in Hong Kong has the obligation to buy car insurance. According to Section 4 of the Motor Vehicles Insurance (Third Party Risks) Ordinance (Cap. 272), all car owners and all permitted users or drivers must have third party insurance covering the relevant motor vehicle. A car owner should arrange car insurance for his or her car.
If you have a car but fail to buy car insurance, you will be liable for a fine of up to HK$10,000 and 12 months imprisonment. The person convicted of the offence may also face disqualification from driving for a period of between 12 months and 3 years.
In addition, you and the permitted driver(s) would have to bear the civil liability for bodily injury or death caused to any third party by any accident arising out of the use of your car without insurance cover. The potential amount of compensation payable by yourself or the driver could be substantial, which may adversely affect your financial status or even make you bankrupt or insolvent.
Now you know the importance. Let’s learn more about the types of car insurance in Hong Kong.
Types of Car Insurance in Hong Kong
There are mainly 2 types of car insurance in Hong Kong: third party liability insurance and comprehensive car insurance. Before we go through them, we should know the 3 operative sections of car insurance, as shown in the following table.
| Operative Sections | Coverage |
| Section (I) | Against loss of or damage to the motor car |
| Section (II) | Against third party legal liabilities |
| Section (III) | Indemnity of medical expenses |
The main difference between third party liability insurance and comprehensive car insurance is that third party liability insurance only covers the loss against Section (II) while comprehensive car insurance covers all Sections.
What’s the Difference between Third Party Liability Insurance and Comprehensive Car Insurance?
| Third Party Liability Insurance and Comprehensive Car Insurance Comparison | |
| Car Insurance Type | Coverage |
| Third Party Liability Insurance | Covers legal liabilities towards third parties with respect to property damage, injury, or death, but does not cover your loss. |
| Minimum Coverage Required by Law | |
| Comprehensive Car Insurance | Protects against loss or damage to your car and third party coverage. |
Third party liability insurance, also known as Section (II) Insurance, is to cover your legal liabilities towards third parties with respect to property damage, injury or death, but it does not cover your loss. Comprehensive car insurance, on the other hand, protects against loss or damage to your car and third party coverage.
Third party insurance coverage is the minimum coverage required under the law. However, it is worth it to consider a more extensive type of protection when choosing car insurance in Hong Kong if you are not familiar with the roads and driving practice, which means a comprehensive car insurance policy is better considered.
Besides, many car insurance policies provide additional services as advanced coverage, such as 24-hour emergency roadside assistance, free towing services; some insurers offer bespoke car insurance solutions for luxury and high-end vehicles. Check with your insurer if you need more information on that.
How To Get a Car Insurance Quote
Budget is always a big consideration when getting car insurance.
To get a car insurance quote, you need to provide at least 4 things:
- the car brand,
- car model,
- manufacturing year, and
- car engine CC.
If you are going to buy comprehensive car insurance, you also need to provide an estimate of the car’s value. These things will help determine the premium you have to pay for your car insurance.
Other than that, the factors below also matter.
Age excess: If you are under 25 years old or have less than 2 years of driving experience, an additional excess will apply when you are at fault in an accident. Also, some insurers might limit them to purchasing comprehensive car insurance only and leave third party liability insurance for ages between 25 and 65 or have at least 2 years of driving experience.
No Claim Discount (NCD): If no claim has been made under your policy for a year or more with the current or existing insurer, a discount of up to 60% could be given to you. It reduces the premium you have to pay as the insurer recognizes and rewards you for being a careful driver.
Excess: An excess is the amount of money you pay towards a claim on car insurance. Higher excess may lower your premium. However, your share of the burden might be heavier when an accident happens.
The amount of money spent on car insurance in Hong Kong can vary significantly depending on the specific circumstances of each driver and car. Generally speaking, third party insurance can cost around HK$2,000 to HK$3,000 per year, while comprehensive insurance can cost from HK$5,000 to HK$30,000 per year, depending on the level of coverage and the insurance company.
Premium
HK$495
- Accidental Death & Permanent Disability
- HK$0
- Accident Medical Expenses
- HK$0
- Hospital Cash (Per day)
- HK$500
- PremiumPremium
HK$55010% Off - HK$495
How to Get the Cheapest Car Insurance in Hong Kong?
Every driver wants to have car insurance that is as cheap as possible if it is good enough. However, you should know that cheaper car insurance policies imply lower levels of coverage. You should consider the best-suited one instead of the cheapest.
One basic requirement of a car insurance plan is that the statutory amount required to cover liability arising out of one event should be nothing less than HK$100 million.
When selecting a car insurance policy, you should first consider your needs and circumstances. Factors such as your driving record, the value of your car, and your financial situation should be taken into account. It is also essential to read the policy details carefully to understand what is and is not covered.
A general rule to follow when choosing the best car insurance policy: make sure it provides the coverage you need at a price you can afford.
Premium
HK$1,160
- Accidental Death & Permanent Disability
- HK$600,000
- Accident Medical Expenses (Per Accident)
- HK$10,000
- Hospital Cash Allowance
- HK$10,000
- Premium
- HK$1,160
FAQs: Car Insurance in Hong Kong
Is a car owner bound to buy third party liability insurance for his or her car under the law?
Yes, Section 4 of the Motor Vehicles Insurance (Third Party Risks) Ordinance (Cap. 272) requires all car owners to have third party insurance covering the relevant car.
What are the consequences if a car owner fails to buy third party liability insurance?
Any person who fails to buy car insurance for his or her car is liable for a fine of up to HK$10,000 and imprisonment for 12 months. The person convicted of the offence may also face disqualification from driving for a period of between 12 months and 3 years.
When I apply for car insurance, do I need to disclose the traffic accidents I have previously been involved in as a driver?
Yes. Insurers will pose questions relating to your previous driving history, you should make full and frank disclosure in answering those questions and providing the requested information in the application form.
If I disclose I have recently been convicted of a traffic offence, will I be charged a higher premium?
The amount of the premium is generally calculated in accordance with a set of data including the driver’s past claim history and traffic conviction records, e.g. illegal parking. If you are in doubt whether certain particulars need to be disclosed, it would be prudent to disclose them to the insurer.
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