Traffic Accident / Personal Injury Team

Personal Injury Laws

B. Automobile Liability Security Act

1. Overview

In modern Japanese society, the number of traffic accidents, such as serious accidents and/or deaths, have drastically increased. This is mainly due to the increase in the number of automobiles on the roads.

Therefore, with the aim of assisting and protecting victims of traffic accidents, the Automobile Liability Security Act was implemented in August 1955.


Automobile Liability Security Act has 4 features:

  • It applies only to automobile accidents;
  • It applies only when the victim is dead or injured, and not to damages of property;
  • The victim does not have to prove intention or negligence on the part of the assailant; and
  • The victim can demand damages from not only the driver but also the owner of the automobile.

Liability Compensation Insurance Scheme

The Automobile Liability Security Act entails the automobile liability compensation insurance scheme, which provides a minimum compensation for personal damage caused in an automobile accident.

Automobile owners are required to obtain an automobile liability compensation insurance. If they do not possess such an automobile liability compensation insurance, then they are faced with payment of a fine and/or legal action being taken against them.

Therefore, a person who is injured in an automobile accident can receive insurance money under the automobile liability compensation insurance scheme.

2. Article 3 of Automobile Liability Security Act

A person who offers a driving service for self shall be liable for damages to the infringement of life, body of others in the service, however, this shall not apply if the offerer attest that the offerer and the driver for the service exercised reasonable care in the service, the victim or the third party except the driver has intentionally or negligence, and the automobile doesn't have any structural defect or functional disorder.

3. Claim procedure for damages of traffic accidents

(1) Negotiations with Insurance Companies

If the assailant possesses insurance, his/her insurance company negotiates with the victim as the assailant's agent. In such a case, the victim has to negotiate with the insurance company.

When the insurance company and the victim ceases negotiations, then the alternative procedures are as follows;

(2) ADR (Alternative Dispute Resolution)

Disputes between the victim and assailant can also be settled by way of ADR.

The Japan Centre for Settlement of Traffic Dispute is one of the ADR organizations in Japan, which not only offers legal advice and consultation to the victims of automobile accidents, but also examines each claim and makes its own decision on the disputes concerned.

Only if the assailant possesses voluntary insurance, will the victim be able to bring a dispute before the Centre. It should also be noted that the Centre handles disputes free of charge.

NOTE: You can initiate a lawsuit if both parties are unable reach an agreement, or if you have a complaint concerning the Centre's own decision.

(3) Mediation

Mediation is also a means of alternative dispute resolution. This is performed before a mediation panel appointed by the court. Such a mediation panel consists of a judge and conciliation commissioners.

The fee for Mediation is generally lower than the fees for filing a lawsuit. Also, the agreement reached between the parties has the same binding effect as a judgement by the courts.

NOTE: You can still initiate a lawsuit if both parties are unable to reach an agreement.

(4) Lawsuit

The procedure of filing a lawsuit tends to be more time consuming and expensive than the other dispute resolution procedures mentioned above. Also, victims tend to obtain more compensation for damages under such ADR and Mediation procedures, rather than by filing a lawsuit.

If the automobile accident occurred in Japan, not only Japanese victims but also foreign victims are entitled to filing a lawsuit in the Japanese courts against the other party. Furthermore, the applicable law would be Japanese Law.