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Car Insurance Around the World

Updated on October 11, 2010

Car insurance first originated in the United Kingdom and the USA towards the end of the nineteenth century and over the last hundred or so years has gradually evolved into the product we are familiar with today.  It surprises many people to learn that legislation relating to car insurance actually differs quite significantly depending on where in the world you live, with some countries having much more strict laws than others, while large federal states like the USA, Canada or Australia often have laws that vary greatly from state to state. In some countries, particularly those in the developing world, even basic third-party insurance is not mandatory and the vast majority of drivers take to the road uninsured. Locals often take novel steps to protect their vehicles in lieu of insurance – people in Bolivia often bring their cars to the local church to be ‘baptised’ by a priest in the hope that God will protect them from accidents. Elsewhere in the world, things are sometimes just as strange.


Many auto industry professionals will tell you that the car helped to build modern America and state legislation in the USA often allows drivers to get on the road at a very early age – teens in Alaska, Arkansas, Iowa, Kansas, North Dakota and South Dakota can get a learner permit at the age of fourteen. As a federal country, laws pertaining to driving often vary significantly from state to state and car insurance is no exception. While third-party insurance is a requirement in most states, it is non-mandatory in Wisconsin and New Hampshire, allowing drivers to drive uninsured in these states if they so choose. Insurance is also non-compulsory in Virginia, but those who opt not to pay are instead charged a $500 fee per vehicle by the state – definitely a strong reason to invest in multi car insurance.


South Africa

In South Africa there is no legal requirement to have even the most basic form of insurance and recent estimates suggest that up to two-thirds of vehicles on the country’s roads may be uninsured. Instead, the government imposes a duty on petrol and diesel sales that goes directly to a Road Accident Fund, which is used to compensate third party victims of accidents where the driver is uninsured. South Africa’s government has come under increasing pressure to make third party insurance mandatory in recent months but Transport Minister Sibusio Ndebele has ruled out any changes to current legislation for several years.


Mandatory car <a href="">insurance</a> is still something of a novelty to many Russians, with motor insurance entirely voluntary until the summer 2003. Under the old Soviet regime, only around 10% of Russians held policies and damage caused in accidents was usually paid on the spot in cash, if the owner accepted responsibility. Fights between drivers were a common occurrence. The introduction of compulsory insurance was met with fierce opposition in Russia with premiums extremely expensive and drivers often expected to pay large excess charges. Driving is notoriously dangerous in Russia, with over 30,000 people killed on the roads in 2008 – only 10,000 less than the USA which has over double the population.

Laws relating to car insurance are different wherever you go; what are they like in your country? Feel free to share in the comments below.


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      Hayat Shenwari 18 months ago

      Hi. My name is Hayatullah from Afghanistan. The Vehicle Insurance (Third party car Insurance) is compulsory by traffic rules but due to corruption it is possible to apply it in here, the premium for third party vehicle Insurance is quite low compare to the other countries, the starting premium is 990 AFs (15 USD for 3 years) and in return we liable to pay for accident to the third party maximum (758 USD) for every accident in these three years. the revenue from vehicle Insurance is at low in current time but once it was quite high in Communist regimes.

      Comprehensive Car Insurance isn't mandatory.

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      Zach 3 years ago

      Is there such thing as international car insurance? I think that should be a policy for some people. I know there are people that travel all the time to other countries. I think it would be convenient for the people that rent vehicles to be covered in their own insurance. Each country has a different way of handling the traffic and driving. It would be rough if you were in another country and ended up wrecking the vehicle. You would be held responsible for the damages and without insurance, it could be difficult to cover that.