Third Party Insurance

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Third Party Insurance

"Third Party Insurance" is a statutory requirement, as per Motor Vehicles Act, 1988. Third party comes from the fact that the prime beneficiary of the policy is neither the original insured nor the insurance company, but a pretentious third party. Third party insurance policy will cover for the liability that is incurred by the owner of the car in the event of unforeseen demise or permanent disability of the third party, sustained during a crash by the vehicle by the policy holder in an accident. As per the rules, Insurance Regulatory and Development Authority (IRDA) of India compute the damages.

Importance of Third Party Insurance:

Third Party Insurance comes in handy when your vehicle hits another vehicle and is beneficial in the legal clause. If in case at the time of accident a death occurs and the victim press charges this allows to register case for claiming compensation. Here the third party motor insurance comes into the picture. It covers the insured vehicles in case any liability claim arises out of bodily injury, property damage, or death of a person. As per IRDA third-party property damage cover is limited up to 7 Lakhs. Also it’s important to have a third party liability insurance if insured owns an old car and doesn’t want to spend his hard-earned money on it.

Third party Insurance is categorized into 2 parts:

  1. Third Party Liability Car Insurance: Third Party Car Insurance is a risk cover, which the insurer can compensates any legal liabilities claimed by the other party, in case the insured vehicle is at fault. As per the Motor Vehicles Act 1988, Section 146, plying an uninsured vehicle on Indian roads is an offence. This is why liability insurance is also known as ‘Act only’ plan. This plan doesn’t cover the insured or his car.
  2. Third-Party Liability Two Wheeler Insurance: Motor Insurance in India is necessary by law for all the registered vehicles and plying on the roads. This rule is applies for two-wheelers as well. Non-compliance may lead to the enforcement of legal punishment, which includes hefty fines and trial under the laws of road safety under the Motor Vehicle Act. Enforcement of legal punishments can be due to non-compliance that will include hefty fines and trial under the laws of road safety under the Motor Vehicle Act. Owing to the risk associated with this type of vehicles (bikes), insuring it with an adequate plan is an ideal decision to keep the stress at a bay.

Third-Party Insurance for Private Vehicle:

Coverage:

  • Body Injury or death of the third party
  • Damage to the property of third party
  • Accidental death of owner or driver of the insured vehicle.
  • Permanent Total Disability of the driver/owner of the insured vehicle

Exclusions:

  • Liability that may arise either directly or indirectly from nuclear materials.
  • Liability claims on contract basis.

Third-Party Insurance for Commercial Vehicles:

Coverage:

  • Demise or body injury to third party.
  • Property damage caused to third party.
  • Permanent total Disability of the owner or driver of the insured vehicle.
  • Legal liability incurred for the injury or damage to the car.

How to claim Third Party Insurance?

  • The victim or the legal envoy of the departed can make an application against the owner of the vehicle for third-party liability compensation
  • Once the application is completed, file an FIR with the police, furnishing the required details. You must have a copy of the FIR and the original records of the expenses incurred by the victim, also have Driver’s Licence number and any witness around then their name and contact number.
  • After filling the First Information Report (FIR) successfully, the next step is to register the case with Motor Accidents Claims Tribunal.
  • There is no pre-decided limit for claiming third party insurance. The insurer compensates the full amount decided by the court in its final verdict. However, IRDA limits the cover for property damage up to 7 Lakhs.

Difference between Comprehensive and Third Party Liability Car Insurance:

Third Party Liability Insurance Comprehensive Car Cover
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