What is an example of compulsory insurance under UK law?

The correct answer is an example of compulsory insurance under UK law because the Road Traffic Act requires all drivers to have at least third-party insurance coverage when using a motor vehicle on public roads. This legislation was established to ensure that injured parties or those affected by a car accident can receive compensation, regardless of the fault of the driver. Such compulsory insurance serves a critical role in promoting accountability among road users and protecting the interests of the public.

In contrast, private medical insurance, buildings insurance, and contents insurance are not mandated by law. While these types of insurance can be beneficial for individuals to protect their health, property, and belongings, they are optional and based on personal preference or financial considerations. Therefore, they do not fall under the category of compulsory insurance.