Owners of China's 130 million motor vehicles, including cars, motorcycles and tractors, will have to buy compulsory motor insurance from July 1, under a new policy published on Monday by China's top insurance regulator.

Owners of family cars will have to pay up to 1,100 yuan (137 US dollars) worth for insurance per vehicle each year if the cars are for family use only, under the rules unveiled by the China Insurance Regulatory Commission.

China's first compulsory insurance rules allow for the policy holder and those named on the policy a maximum of 60,000 yuan in cover for property damage, injury and death, according to the commission.

Different insurance rates were imposed on 42 categories of vehicles, including family cars, corporate non-commercial vehicles, public transport vehicles, motorcycles and farm tractors.

At present, only about 35 percent of business vehicles are covered for damage and injury, according to the commission.

A total of 98,738 people were killed and 470,000 injured in 450,000 traffic accidents last year, causing 1.88 billion yuan in direct economic losses, official statistics show.