The supplementary compensation has always been adopted in civil compensation for motor vehicle traffic accidents due to the improper consideration of the subjective and objective factors. With regard to subjective factors, the fault degree of all parties should be distinguished, that is, the difference between intention and negligence and the difference between general and gross negligence. Accordingly, the principle of fault liability should be fully adhered to in terms of the principle of attribution, thus conforming to the basic concept that individuals should be liable for damages caused by their own actions. As for objective factors, the damage caused by motor vehicle traffic accident should not be differentiated through damage types but the damage degree, namely, minor damage, general damage, and major damage. Therefore, taking both subjective and objective factors into account, this paper proposes that punitive damages should be introduced into the liability for motor vehicle traffic accidents, and a compensation structure combining supplementary and punitive damages should be established.