Motor Insurance

In Hong Kong, it is compulsory to have HKD100,000,000 Third Party Liability insurance in case we injure someone.

In addition, insurers provide liability cover for third party property damage. The maximum property damage cover is HKD2m (This property damage limit can sometimes be increased by negotiation, most commonly to HKD5m).

Similar to most countries, there are two types of car insurances available in HK as well.

Third Party & Comprehensive

While Third party only covers liability to others, Comprehensive cover includes the cost of repairing damage to your own vehicle, whether or not you are at fault.

If your car is worth under HKD1,000,000, most policy wordings will be almost identical in terms of benefits.

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Third-party only and Comprehensive coverage

Coverage Features	Third Party Only (Legal Minimum)	Comprehensive (Full Protection)
Third Party Bodily Injury / Death Statutory requirement in HK	✔ Covered Up to HK$100,000,000	✔ Covered Up to HK$100,000,000
Third Party Property Damage Damage to other cars/public property	✔ Covered Usually up to HK$2,000,000	✔ Covered Usually up to HK$2,000,000
Legal Liability for Passengers Injury to passengers in your car	✔ Covered As part of third party bodily injury	✔ Covered As part of third party bodily injury
Damage to Your Own Car Accidental collision damage	✘ Not Covered	✔ Covered Subject to excess/deductible
Fire & Theft	✘ Not Covered	✔ Covered
Windscreen / Car Windows Cracks or breakage	✘ Not Covered	✔ Covered Usually no excess up to limit (e.g. HK$4K)
Towing Service Following an accident	✘ Not Covered	✔ Covered Reasonable cost to nearest repairer
Medical Expenses	✘ Not Covered	✔ Covered Limited amount per person
No Claim Discount (NCD) Protection Protects NCD even after 1 small claim	✘ Not Covered	✔ Optional / Included Depends on insurer & plan
“New for Old” Replacement For new cars (usually under 1 year old)	✘ Not Covered	✔ Often Included For total loss of brand new cars
24-Hour Roadside Assistance Flat tyre, battery jump-start, fuel delivery	✘ Not Covered	⚠ Optional Often as add-on or included in premium plans
Loss of Use / Car Rental Alternative transport while car is being repaired	✘ Not Covered	⚠ Optional Daily limit and maximum days apply
Personal Belongings Cover Items stolen from or damaged in the car	✘ Not Covered	⚠ Optional Subject to per item and total limits
Voluntary Excess Reduction Pay extra premium to lower excess amount	✘ Not Available	⚠ Optional Reduces out-of-pocket cost in a claim
Natural Disasters Typhoon, flood, landslide damage	✘ Not Covered	✔ Usually Covered Check for specific exclusions
Strike, Riot & Civil Commotion Damage due to social unrest	✘ Not Covered	⚠ Optional / Included May be included in comprehensive plans
Overseas Coverage Extension Short-term cover in Macau / mainland China	✘ Not Covered	⚠ Optional Limited days per trip, extra premium applies
Agreed Value Cover Pre-agreed car value for total loss	✘ Not Available	⚠ Optional For classic or modified cars

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Motor Insurance Insights

You need to know

Coverage Type – Choose between Third Party, Third Party Fire & Theft, or Comprehensive based on your protection needs.
Vehicle Value – Ensure your car is insured for the current market value in case of a total loss.
Driving History – Maintain a clean record to qualify for No-Claims Discount which lowers your premiums over time.
Excess Amount – Familiarize yourself with the deductible you’re responsible for paying in partial loss claims.
Optional Coverages – Consider add-ons like windshield repair/replacement or passenger liability coverage.
Vehicle Usage – Inform your insurer about any commercial use that differs from standard social/commuting purposes.
Authorized Drivers – Disclose all regular drivers to be covered under the policy.
Vehicle Security – Confirm your car meets the minimum safety standard requirements like an alarm/immobilizer.
Policy Terms – Understand covered/excluded uses and actions that could void your insurance coverage.
Payment Schedule – Note due dates and applicable interest charges for missed premium installments.
Accident Reporting – Attend to any police report filing or insurer notifications right away after an incident.
Renewals – Review coverage limits periodically as your needs and vehicle value change over time.

Motor Insurance FAQs

What is required by law?

In Hong Kong, it is compulsory to have HKD100,000,000 Third Party Liability insurance in case we injure someone.

Is the driver covered for injury to himself and passengers?

There is NO cover for the driver, as he is not a third party. There is cover for the passengers, bystanders and those in another vehicle, but there is no cover for the drivers medical bills, rehabilitation costs or the long term loss of income that may result. This requires separate insurance.

What is the effect of having a 'No Claim Discount or No Claim Bonus' on how much my insurance costs?

In Hong Kong, few insurers will agree to this if you have not owned a car in the past year.

If you have owned a car in the past year, or still own a car but keep it abroad to use like a rental vehicle, the insurer will likely agree to reduce your premium – IF you can provide a letter from the previous/current insurer, showing how many years in the past 5 you have been claim free.

It is possible for you to transfer your ‘no claim entitlement’ to your spouse or your company, or vice versa. Different insurers have different rules on this.

As soon as you inform an insurer of a claim or a likely claim, the market practice is to remove your No Claim Bonus entitlement and only to return this to you after there has finally been a court case to determine who was at fault.

What is a no-claims discount?

Motorists receive a discount on future premiums for not filing any claims in the previous year/s. The longer your no-claims record, the higher the percentage discount.

What does comprehensive coverage include?

Comprehensive insurance covers damages from accidental collisions, fire, theft, and natural disasters. It reimburses the policyholder for repairs or replacement costs.