Shanghai Municipality, Compensation Liability Regarding Road Traffic Accidents Involving Motor Vehicles Several Provisions

Promulgated: February 24 2005
Effective: April 1 2005
Applicability: These Provisions apply to road traffic accidents involving motor vehicles occurring within the Shanghai administrative jurisdiction, and leading to determination of the compensation liability for death, bodily injuries or property loss (Article 2).

Main contents: The Provisions state that the limit of liability of compulsory third-party liability insurance for motor vehicles (Compulsory Insurance) in Shanghai is Rmb40,000. If the state has other provisions concerning a Compulsory Insurance system, those provisions shall prevail (Article 3). In the case of traffic accidents between motor vehicles, the insurance companies of each party shall, within the limit of liability of the Compulsory Insurance, compensate for the actual loss incurred (Article 4). In the case of traffic accidents between drivers of motor vehicles and drivers of non-motor vehicles or pedestrians, the insurance company of the motor vehicle party shall, within the limit of liability of the Compulsory Insurance, compensate for the actual loss incurred (Article 5). Article 8 sets forth the exemption clauses for motor vehicle compensation liability. The motor vehicle party shall not be liable for compensation in traffic accidents where losses are deliberately caused by drivers of non-motor vehicles or pedestrians. For traffic accidents between drivers of non-motor vehicles or pedestrians and motor vehicles in a stationary state, if the motor vehicle party is not liable for the traffic accident, it shall not bear the liability for compensation.
Related legislation: PRC Road traffic Safety Law, Oct 28 2003, CLP 2004 No.5 p9