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Which Drivers Require Auto Liability Insurance?

The Merriam-Webster Dictionary defines automobile liability insurance as “insurance against loss from or legal liability for damages arising out of ownership, maintenance or operation of an automobile”.

Most developed countries require some form of liability insurance, whether it is publicly or privately funded. In the United States coverage requirements are left up to the individual states, but all 50 states have liability mandates. Policies can apply to individuals and/or vehicles with the idea that nobody is operating an auto without insurance in place.

In the UK auto liability statutes trace back to 1930 and have evolved into today’s modification of the Road Traffic Act of 1988 whereby motorists need to be either insured, have a security, or post a bond with the Accountant General of the Supreme Court.

In Canada minimum requirements vary from province to province with some provinces (Quebec, Manitoba, British Columbia and Saskatchewan) offering public insurance while others leave it to private insurers.

States in Australia utilize a form of insurance called Compulsory Third Party Insurance, or CTP. Insurance. Individual vehicles are covered but no vehicle can be operated without it, in essence ensuring that all drivers are carrying coverage. Third-party insurance is a “policy purchased for protection against the actions of another party. Third-party insurance is purchased by the insured (first party) from an insurance company (second party) for protection against another party’s claims (third party).” *

South Africa allocates a portion of gasoline revenue into a Road Accident Fund. The fund is form of third-party coverage used to compensate victims in accidents. Again, the third-party method is designed to cover all vehicle operators.

In the United States even foreign diplomats and missionaries must comply with liability regulations, under the auspices of the Diplomatic Motor Vehicle Office, established in 1984. The rules are different for government, emergency or military vehicles in that third-parties may find it very difficult to receive proper compensation if they are involved in an accident. Even here, however, there are protocols that provide coverage for victims. The bottom line is that virtually every driver is going to be covered in some manner.


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