Quick answer: Those who cause traffic accidents must compensate all actual losses: medical costs, lost income, funeral expenses and maintenance allowances (for fatal cases), plus moral-damage compensation. Motor vehicles count as highly dangerous sources — owners are liable even without fault, unless the damage resulted entirely from the victim’s intentional fault (Article 601 of the Civil Code). In parallel, compulsory motor-vehicle liability insurance (Decree 67/2023) covers part of third-party losses.
Traffic accidents in Vietnam often end with verbal settlements based on “estimated” sums — the seed of disputes dragging on for years. Calculating correctly helps you negotiate fairly or sue effectively.
Grounds for compensation liability
Article 584 of the 2015 Civil Code sets non-contractual compensation liability where four elements concur: actual damage, an unlawful act (traffic-rule violation), fault of the wrongdoer, and causation between act and damage. Article 585’s principle: actual damage must be compensated fully and promptly; parties may agree on amounts, forms and methods — but agreements must not contravene law or social morals.
Claims where health is harmed
Article 589 lists compensable items for health injuries:
- reasonable costs of emergency care, treatment, rehabilitation and restoration of lost or reduced bodily functions;
- actual income lost or reduced during treatment;
- reasonable costs and lost income of the victim’s caregiver during treatment;
- moral-damage compensation — capped at 50 times the State-prescribed base salary, unless otherwise agreed.
Keep every hospital invoice, prescription, discharge paper and income certificate — without documents, courts rarely accept claimed figures.
Claims where life is lost
Article 590 covers fatal cases: reasonable pre-death medical costs; reasonable funeral expenses; maintenance for persons the deceased was obliged to support; and moral-damage compensation for relatives — capped at 100 times the base salary unless otherwise agreed. Disputes over “reasonable funeral expenses” and maintenance levels are the hottest points in such lawsuits.
Motor vehicles as highly dangerous sources
Critically, Article 601 classifies operating motor vehicles as highly dangerous sources. Their owners must compensate damage caused by such sources even without fault, except where damage resulted entirely from the victim’s intentional fault or from force majeure or emergency circumstances. In a car–motorbike collision, the car owner can hardly walk away entirely on “I wasn’t at fault” reasoning.
How compulsory insurance pays
Decree 67/2023/ND-CP (amended by Decree 220/2026/ND-CP, effective 01/7/2026 — motor-vehicle insurance content unchanged) mandates motor-vehicle owners’ civil liability insurance. After an accident, the insurer compensates injured third parties within liability limits (VND 150 million per person per accident for health and life damage), based on actual injury rates. Losses exceeding the insurance limit remain the wrongdoer’s personal liability.
Negotiate, mediate, then sue
The wise sequence: direct negotiation with a written settlement record; if that fails, mediation at the commune-level People’s Committee or a mediation center; litigation last. The limitation period for non-contractual damage claims is 3 years (Article 588 of the Civil Code). File at the Regional People’s Court where the defendant resides. Cases involving foreigners should heed foreign-element jurisdiction rules.
Legal basis
- Articles 584, 585, 588, 589, 590, 601 of the 2015 Civil Code — grounds, principles and limitation for non-contractual compensation; health and life damage items; highly dangerous sources.
- Decree 67/2023/ND-CP (amended by Decree 220/2026/ND-CP) — compulsory motor-vehicle owners’ civil liability insurance.
Key cautions
- After an accident, call the police to record the scene immediately — the record is key evidence on each party’s fault.
- Don’t sign any “waiver” or “no-claim” paper while in shock at the scene.
- Put every compensation agreement in writing, signed by both sides, stating whether payment is full or partial.
Frequently asked questions
I obeyed the law but a motorbike hit my car. Who compensates whom?
Each party answers for damage they caused, apportioned by fault. But because cars are highly dangerous sources, the car owner may still owe part of the rider’s losses even where the rider was mainly at fault — unless the damage resulted entirely from the rider’s intentional fault.
Does compulsory motorbike insurance cover the pillion passenger?
Compulsory liability insurance covers third parties harmed by your vehicle, including passengers of the other vehicle. Injuries to yourself and your own passenger fall under voluntary insurance (passenger accident insurance), not the compulsory scheme.
We settled, but the other side won’t pay in full. Now what?
A written compensation agreement is enforceable as a civil transaction. If breached, sue for performance (3-year limitation). Never settle large sums orally.
A foreigner caused an accident in Vietnam. How is it handled?
Civil liability applies as to Vietnamese citizens (Article 584 of the Civil Code). Depending on severity, the driver may also face administrative penalties or criminal liability for road-traffic violations (Article 260 of the Penal Code). Foreigners should notify their consulate and contact a lawyer immediately.
Accidents are stressful enough — don’t let compensation disputes drag on for years. FLAT Law Firm calculates the full Article 589–590 claim items, deals with insurers and represents you in negotiation or litigation — keep all medical records and the scene report, and contact us as early as possible.
This article has been quality-reviewed by the FLAW AI Legal Council
