This final paper presents the system of compulsory motor third party liability insurance in the law of the European Union. The development of motor third party liability insurance itself is presented through a number of directives and special attention is paid to Directive 2009/103/EC and Directive 2021/2118 which are currently in force. It is explained what insurance is in general and who are the parties of insurance contracts. Key words are explained as well, likewise case law related to those terms. Also, it is shown who is obligated to conclude a car liability insurance contract and how the insurance is checked. The financial aspects of compulsory insurance are considered through the minimum amounts of insurance coverage that Member States are obligated to incorporate into national legislation, but also the issue of financing guarantee funds and the case of bankruptcy of an insurance company. We will also study the possibilities of resolving insurance disputies and which persons are covered by the insurance. Special attention is paid to the procedure for compensation of damages and the deadlines within which the insurer is obligated to compensate it. Finally, we will compare European directives with national legislation.