Why do I need Vehicle Insurance?

Let's break this down into the two categories of vehicle insurance:

1. Damage you cause to another person/vehicle in an accident.  This is known as Third Party Insurance and is required by Law.  (Attached to this article)

2. Damage that is caused to your vehicle.  This is optional coverage, and not required by Law.  But generally it is still required if you have a loan against the vehicle, so that if the vehicle is damaged, the bank can recover their loan amount.