No-fault liability system is a specific form of compensation to the victims applied for automobile insurance, the system originated from Canada, and further popularized it in the United States and spread over other countries or regions. In Taiwan, the government amended the law and officially announced the implementation of the Compulsory Automobile Liability Insurance Act in 2005, the right of victims of compensation also followed the above system. Surprisingly, when checking the contents of the Law, the related regulations, and the practical implementation, we found that some clauses and practice of the Law related to the said system could be inconsistent with the meaning of 〝real〞no-fault system. In this paper we will review firstly the background of no-fault system, as well as its real meaning, and accordingly revise the Taiwan Compulsory Automobile Liability Insurance Act and its practical implementation. We will concern the scope of who is injured victim, specially in the case of a single accident caused injury or death of the victim (including the drivers of motor vehicles), and how speedy the insurance company could compensate the injured victims no matter how many automobiles are involved in an accident.. Finally, with regard to the risk classification on insurance rates, some clauses of the Law which is inconsistent with the real no-fault system should also be rectified, particularly the regulations of the rating factors involving motorists. Hopefully this paper could be of benefit to the improvement of the Compulsory Automobile Liability Insurance in Taiwan.