【Legal Life】Ch10 Car Accident: Who Pays the Damages!?

After the traffic accident, Chieh-yun not only had a wrecked scooter but also injured her leg. Standing before the damaged scooter and looking at her string of bad luck in the rearview mirror, she worried as a college student about how she would afford the scooter repairs and medical expenses. Suddenly, out of the corner of her eye, she spotted a contact number left by an insurance agent inside the scooter's storage compartment when her mother bought her insurance policy. Remembering she had insurance and recalling the compulsory automobile and motorcycle liability insurance she had seen on TV, Chieh-yun felt as though she saw a glimmer of hope. Like a drowning person catching a piece of driftwood, she picked up her phone and dialed the number…

When an unfortunate car accident happens, aside from caring for one's own safety, if there are bodily injuries or property damage, one can also secure partial protection through insurance. There are various types of insurance, and the two most important types for car and motorcycle owners are "Compulsory Automobile (and Motorcycle) Liability Insurance" and "Third-Party Liability Insurance." Many drivers or riders may have only heard of their names without knowing whether they are insured, what kind of protection the insurance actually provides, or even failing to receive the most basic protection after an accident occurs.

Compulsory Automobile (and Motorcycle) Liability Insurance

Taiwan promulgated the Compulsory Automobile Liability Insurance Act in 1996 and extended it to motorcycles in 1999, requiring all motor vehicle owners to take out compulsory insurance to ensure that victims of motor vehicle accidents causing injury or death can promptly obtain the most basic protection. However, before understanding compulsory automobile and motorcycle liability insurance (hereinafter referred to as compulsory insurance), one must first grasp an important concept: compulsory insurance "pays out to others," not to oneself. If you are injured in a car accident yourself, you can file a claim with the other party's insurance company. Therefore, this type of insurance can also be referred to as cross-indemnification. Simply put, your compulsory insurance is used to pay out to the other party (including the other driver, the other passengers, our passengers, and other third parties), while the other party's compulsory insurance is used to pay out to our side (including our driver and passengers). From this, we can understand that when a traffic accident occurs, the primary beneficiaries protected by compulsory insurance are: passengers and third parties outside the vehicle.

To examine in detail who "can" apply for compulsory insurance claims, we can break it down as follows:

1. Single-vehicle traffic accidents (e.g., a car crashing into a safety island)

   In this case, those who can apply for compensation from the insurance company underwriting the accident vehicle's compulsory insurance are third parties outside the vehicle (such as pedestrians) and passengers inside the vehicle, whereas the driver "cannot" apply for compensation (hence insurance companies usually advise drivers to purchase "Driver Injury Insurance" to share the risk).

2. When a traffic accident involves two or more vehicles

   In this case, third parties outside the vehicle and passengers inside the vehicle can apply for compensation from the insurance company insuring any of the vehicles. Meanwhile, drivers can apply for compensation from the insurance company insuring any of the other vehicles.

What are the payout standards for Compulsory Automobile Liability Insurance?

1. Total amount for injury and medical expense benefits:
   Maximum of NT$200,000 per person per accident, which includes
   • First-aid expenses: rescue and search fees, ambulance fees, and fees for accompanying medical personnel.
   • Medical treatment expenses: items within the scope of National Health Insurance benefits and out-of-pocket outpatient, emergency, or hospitalization expenses, registration fees, etc., borne by the victim.
   • Transportation expenses: reasonable transportation costs for transferring hospitals, being discharged, and traveling to and from outpatient visits.
   • Special nursing fees, nursing care fees, etc., required due to severe conditions during hospitalization.
2. Disability benefits: Divided into 15 levels based on the degree of disability, with payout amounts ranging from NT$50,000 for level 15 to NT$2,000,000 for level 1.
3. Death benefits: NT$2,000,000 per person.
4. The combined total of death, disability, and injury medical benefits for each person in each traffic accident is capped at a maximum of NT$2,200,000.
5. It should be noted that compulsory insurance only covers injuries or death; property losses are not included within the scope of compulsory insurance.

What is the "Automobile Traffic Accident Special Compensation Fund"?

In short, to prevent victims of traffic accidents from being unable to claim compensation because the vehicle responsible for the accident is not covered by compulsory insurance or because the vehicle fled the scene, rendering it untraceable, the government established the Automobile Traffic Accident Special Compensation Fund in accordance with Article 38 of the Compulsory Automobile Liability Insurance Act. This allows victims of traffic accidents or their heirs to also receive compensation within the scope of compulsory insurance payouts.

Automobile Third-Party Liability Insurance

Automobile third-party liability insurance (hereinafter referred to as third-party liability insurance) is an insurance policy where, when a driver inadvertently causes property damage, bodily injury, or even death to others while driving, and is legally obligated to bear compensation liability upon a claim for damages, the insurance company assumes liability to compensate the insured for the portion exceeding the compulsory insurance amount, appropriately supplementing the protection provided by compulsory automobile liability insurance.

Losses in traffic accidents generally do not go beyond bodily injuries and property damage. Although bodily injuries have the protection of compulsory insurance, most compensation amounts far exceed the payouts of compulsory insurance, not to mention that property damage also needs to be resolved (especially when you crash into a Lamborghini...). This means that if the tortfeasor bears liability for compensation, they ultimately still have to shell out a large sum of money to settle or compensate for the entire accident, which is a considerable burden for ordinary people. Under such circumstances, third-party liability insurance offers various insurance combinations covering both bodily injury and property damage for consumers to choose from, allowing consumers to select coverage based on their own needs and add an extra layer of protection for themselves.

Comparison between Compulsory Insurance and Third-Party Liability Insurance:

Insurance Type / Item	Third-Party Property Damage	Third-Party Bodily Injury	Third-Party Death
Compulsory Insurance	Not covered	Up to 200,000 / per person	Up to 2,000,000 / per person
Third-Party Liability Insurance	Bears compensation liability within the insured limit	If the amount payable exceeds the payout limit of compulsory insurance, third-party liability insurance will pay out according to the insured amount

For details, see Huang Li-ching | What is Third-Party Liability Insurance?

When a car accident happens, how should I handle subsequent insurance issues?

1. An accident occurs

   ※ Although the police will take photos, it is still recommended to take your own photos and memorize the other party's license plate number, vehicle model, color, or other features and contact information.

   • If there are injured persons, rush the injured to the hospital for emergency treatment
   • Call the police and ask officers to come to the scene to handle the matter
   • Maintain the integrity of the accident scene (do not arbitrarily move vehicles), and place warning signs at a certain distance behind the vehicle
   • Inspect and verify that the accident scene diagram is accurate and correct (such as the relative positions of both parties, skid marks, traffic signals, whether the other driver was fatigued, etc.)
   • The police will take statements from both parties and issue a "Traffic Accident Party Registration Slip" (remember to check whether the content is correct)
   • Notify the insurance company, and the insurance company will assess the situation and decide whether to dispatch personnel to the scene to assist

2. Applying for claims

   Prepare the relevant documents and apply for claims with the insurance company:

   • Claim application form
   • Claimant identification documents
   • Police agency handling certificates, etc.

3. Applying for compensation from the Special Compensation Fund

   If any of the following circumstances apply, you can apply for compensation from the Special Compensation Fund:

   • The accident vehicle cannot be traced (hit-and-run)
   • The accident vehicle is uninsured
   • The accident vehicle was used without the insured's consent
   • The accident vehicle is a vehicle not required to be covered by compulsory insurance

Do not settle privately

Sometimes we often hear that the other party or the police, out of a desire to hush things up and avoid trouble, may demand a private settlement. Here, it is recommended that everyone avoid settling privately on a whim, nor should you foolishly promise to pay the other party a claim amount. When a dispute arises, exchange each other's insurance company phone numbers and leave everything to the insurance company to handle.

What documents do I actually need to prepare?

	Insurance Company			Special Compensation Fund
Claim Documents	Injury Medical	Disability Benefits	Death Benefits	Injury Medical	Disability Benefits	Death Benefits
Claim Application Form	√	√	√
Claimant Identification Documents	√	√	√	√	√	√
Police Agency Handling Certificate	√	√	√	√	√	√
Qualified Physician Diagnosis Certificate	√			√
Photocopy of Medical Expense Receipts*	√			√
Consent to Review Medical Records Statement	√			√
Qualified Hospital or Physician Disability Diagnosis Certificate		√			√
Consent to Re-examination Statement		√			√
Death Certificate			√			√
Full Household Registration Transcript			√			√
Special Compensation Fund Application Form				√	√	√
Statement of No Compensation Received				√	√	√
Receipt and Notice of Subrogation Rights				√	√	√
Photocopy of Judgment or Settlement (Mediation) Document				√	√	√
Other Materials Favorable to Subrogation Recovery				√	√	√

When applying for compulsory insurance, you can use a photocopy of medical expense receipts affixed with a "true copy of original" stamp and the medical institution's dedicated receipt seal; you can keep the original for personal commercial insurance or other uses.

We often see some online articles place special emphasis on filling out the claim application form for compulsory insurance "within 5 days," but the reality is not quite like that. According to the conditions for the extinguishment of the right of claim prescribed in Article 14, Paragraph 1 of the Compulsory Automobile Liability Insurance Act: (1) The claim shall be extinguished if not exercised within two years from the date when the claimant knows of the damage and the insurance company; or (2) If more than 10 years have elapsed from the date of the traffic accident. This means that the application deadline for compulsory insurance is anytime "within two years of the accident," and there is no need to rush to apply. You can first handle other more urgent matters (such as seeing a doctor for injuries) and then prepare the documents to apply for compensation. However, you should also be careful not to let your rights lie dormant by forgetting the statute of limitations!

Related Articles

"Compulsory Automobile Liability Insurance Act"

Article 1: "This Act is enacted to enable victims of motor vehicle accidents causing injury or death to promptly obtain basic protection and to maintain road traffic safety."

Article 7: "Where a motor vehicle accident causes injury or death to a victim, **regardless of whether the tortfeasor is at fault**, the claimant may request insurance benefits from the insurer or request compensation from the Automobile Traffic Accident Special Compensation Fund (hereinafter referred to as the Special Compensation Fund) in accordance with the provisions of this Act."

Article 14: "The right of a claimant to claim insurance benefits from an insurer shall be extinguished if not exercised within two years from the date when the claimant knows of the damage and the insurer. The same shall apply if more than ten years have elapsed from the date of the motor vehicle accident."

Article 27: "The benefit items of this insurance are as follows: 1. Injury and medical expense benefits. 2. Disability benefits. 3. Death benefits."

Article 28: "Where a victim or other claimant falls under any of the following circumstances, causing a motor vehicle accident involving the insured vehicle, the insurer shall bear no liability for insurance benefits: 1. Caused by intentional acts. 2. Caused by engaging in criminal activities."

Article 29: "Where the insured falls under any of the following circumstances, causing a motor vehicle accident involving the insured vehicle, the insurer shall still bear the liability for insurance benefits in accordance with the provisions of this Act. However, it may subrogate the claimant's request against the insured within the scope of the benefit amount paid: 1. Driving a motor vehicle after consuming alcoholic beverages or other similar substances, where the alcohol concentration in exhaled breath or blood exceeds the standards prescribed by road traffic management regulations. 2. Driving a motor vehicle and testing positive for the use of drugs, hallucinogens, narcotics, or other similar controlled substances. 3. Caused by intentional acts. 4. Engaging in criminal activities or evading lawful arrest. 5. Driving a vehicle in violation of Article 21 or Article 21-1 of the Road Traffic Management Penalty Act."

Article 30: "Where a claimant's settlement, waiver, or other agreement with the insured impedes the insurer's subrogation of the claimant's request against the insured pursuant to the preceding Article, without the insurer's consent, the insurer shall not be bound thereby."

Article 31: "Where a motor vehicle accident occurs and the insured has already made partial compensation, the insurer shall bear liability for benefits only within the scope of the balance remaining after deducting such compensation amount from the insurance amount prescribed by this Act. However, if the claimant and the insured have agreed that no deduction shall be made, such agreement shall govern. The amount of advance compensation made by the insured under the preceding paragraph shall be paid by the insurer to the insured within the scope of the insurance amount prescribed by this Act. However, this shall not apply to the proviso of the preceding paragraph."

Article 32: "Insurance benefits disbursed by an insurer pursuant to the provisions of this Act shall be deemed as part of the damages compensation amount of the insured; when a claim for compensation is made against the insured, such amount may be deducted."

Article 33: "Where the occurrence of a motor vehicle accident is attributable to a third party other than the insured, the insurer may, after disbursing the insurance benefits, subrogate the insured's claim against the third party. However, the amount it may claim shall not exceed the insurance benefits disbursed. Where the third party referred to in the preceding paragraph is the spouse, household head, family member, blood relative within the fourth degree of kinship, or relative by marriage within the third degree of kinship of the insured or the claimant, the insurer shall have no right of subrogation. However, this shall not apply where the motor vehicle accident is caused by their intentional act."

Article 34: "When a motor vehicle accident involving the insured vehicle occurs, the following provisions shall be complied with: 1. The insured or tortfeasor shall personally or ask someone else to immediately rush the victim to local or nearby medical institutions for emergency treatment. However, this shall not apply where it is obvious under the circumstances that rescue is impossible. 2. The insured or tortfeasor shall immediately report the incident to local police and military authorities for handling, and shall notify the insurer in writing within five days. Claimants may also directly notify the insurer in writing. 3. The insured, tortfeasor, and claimant shall cooperate with the insurer by providing witness testimony, physical evidence, and related information and documents."

Article 40: "When a motor vehicle accident occurs, if a claimant is unable to request insurance benefits from the insurer pursuant to the provisions of this Act due to any of the following circumstances, they may request compensation from the Special Compensation Fund within the scope of the insurance amount prescribed by this Act: 1. The accident vehicle cannot be traced. 2. The accident vehicle is an uninsured vehicle. 3. The accident vehicle is an insured vehicle used or managed without the insured's consent. 4. The accident vehicle is wholly or partially a vehicle not required to enter into this insurance contract."