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Third Party Car Insurance

Third-party car insurance is the basic insurance that is compulsory for every car owner to hold while driving. It gives coverage to the third parties for their damages caused due to an accident with the insured car. Also, being a mandatory cover, it delivers legal compliance as well along with the coverage.

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What is Third Party Insurance Cover?

Third-party insurance is car insurance coverage which insures you against all the 3rd party legal liabilities which may arise due to any mishap such as a road accident involving your car. It provides coverage for bodily injury/death of a third party (as decided by a court of law) as well as third-party property damage up to Rs. 7.5 lakh.

How Does Third Party Insurance Work?

If a policyholder holding third party car insurance gets involved in an accident, then the car insurance company is liable to provide him with financial assistance for his liabilities towards a third party for their injuries, death and property damage. This insurance cover lessens the financial burden of the policyholder for any damage sustained by a third party with the insured car.

In case of an accident, the insured person should intimate the insurer immediately about the mishap before raising a claim. After the claim is raised, the insurance company appoints a surveyor to examine the extent of damages and verify the estimated repair cost. After the verification process, the insurance company pays off the amount of the claim.

Importance of Third Party Car Insurance Policy

Why do you need third party insurance for a car? As per the Motors Tariff Act 2002, it is mandatory for every vehicle owner in India to have at least a 3rd party car insurance. A third party car insurance policy provides the most basic coverage and is more affordable as compared to a comprehensive plan. Thus, besides being a mandatory requirement it is also essential to have your vehicle/car insured by at least a 3rd party only cover so that you have a minimum of basic insurance coverage for your car.

Why Do You Need Third Party Insurance?

Apart from the legal clause, third party car insurance comes in handy when the insured car hits another vehicle. Nobody can gauge the level of damage caused by an accident as it can even lead to injury, disability and sometimes death as well. In such cases, the victim is allowed to register a case claiming compensation. Here third party insurance comes into the picture. It covers the insured vehicle in case any liability claim arises for causing bodily injury, property damage, or death of the third party. As per the guidelines of IRDAI, while there is no limit in case of death, the property damage coverage is limited up to Rs 7.5 lakh in the case of car insurance. It is better to stick to third party liability insurance if the insured vehicle is more than 5 years old.

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What All Is Covered Under A Third-Party Insurance Cover?

Although the third party car insurance cover holds a limited coverage, still it is crucial to cover for the below-mentioned coverage:

  • Third Party Property Damage: All third-party property damage is covered under the third party only cover up to Rs.7.5 lakh.
  • Third Party Death/Bodily Injury: Under a third-party plan, the insurer provides 100% compensation in case of death of a third party and 50% indemnification in case of partial blindness or loss of a limb. The compensation amount for third party liabilities is decided by a court of law.

What Is Not Covered Under Third Party Car Insurance?

A third-party car insurance policy does not provide coverage for own damage sustained by a vehicle or its driver/owner. To get insurance for the own damage of your car, you can purchase a comprehensive car insurance policy or a standalone own-damage car insurance policy. Also, to insure yourself or the driver of your car you need to opt for a personal accident cover or paid driver cover, as the case may be.

Key Features of Third Party Car Insurance

The following are the features of a third party insurance policy:

Key Feature Availability with Third Party Cover
Property Damage Available with a limit of Rs. 7.5 Lakh
Personal Accident Cover Available
Add-on Covers Not-Available
Purchasing Options Online and Offline
Own Damage Costs Not Covered

Compare: Third-Party Insurance Vs Comprehensive Insurance

Here are some differences between a third party car insurance policy and a comprehensive car insurance policy:

Basis Third-Party Car Insurance Comprehensive Car Insurance
Coverage The 3rd party insurance offers compensation for injury/death of a third party( as decided by a court of law) and third party property damage (up to Rs 7.5 lakh).
Comprehensive car insurance policies offer compensation for damage caused to the insured vehicle as well as the injury/death of a third party. It also offers coverage up to a maximum cap of Rs 7.5 lakh in case of third party property damage.
Add-ons No such add-on covers are available for purchase with the third-party policies. A number of add-on covers such as Zero Depreciation Cover, Consumables Cover, etc. are offered along with comprehensive car insurance policies against an extra premium.
Cost Third party insurance is compared to cheaper to comprehensive policies due to its limited coverage. Comprehensive plans are comparatively costlier due to extensive coverage.

What are the Benefits of Buy/Renew Third Party Four Wheeler Insurance?

The following are the benefits of purchasing third party four wheeler insurance:

  • It is Compulsory: Third-party 4 wheeler insurance is compulsory and if caught without one you can be punished, hence, having one ensures you abide by the law. With the help of this car insurance policy, you can drive your car legally without violating any traffic rule and save yourself from any type of fine or imprisonment.
  • Peace of Mind: In case of a mishap there can be immense financial pressure on people. If a third party is involved it becomes even more cumbersome. With third party insurance, you can be assured these liabilities will be covered which ultimately boosts your morale and lets you drive more freely.
  • Low Premium Amount: The third-party insurance is available at very low and affordable prices and proves to be extremely useful in times of crisis. Its reasonable rate is also an advantage of this car insurance policy which lets you find a good amount of coverage by investing a low amount.
  • Cost-Effective Insurance Plan: The coverage provided to a policyholder under third-party liability insurance is cost-effective in regards to the cost and payable premium amount. Irrespective of the fact whether it has to be used as an important or as an add-on part of the basic insurance cover, it completely benefits the car owner. However, when calculating the compensation amount, the annual income of the car owner is considered.
  • Simple, Seamless and Quick Insurance Buying Process: The buying procedure of third-party insurance is a very simple and swift process. Any person can easily purchase the third-party insurance cover online from the comfort of their home or any other place. Moreover, the policyholder can also choose to get their insurance plan renewed online easily by following the simple instructions laid by the insurance company or web insurance aggregator.
  • Offers Financial Assistance against Legal Liabilities: Legal liabilities arising towards a third party property or person can be extremely financially draining and at times can even result in bankruptcy in case the vehicle owner is unable to pay for the damage or loss to the third party. This is when a third-party insurance plan comes to the aid as it offers the policyholder with much-needed financial assistance and helps them in paying off the third-party liability without robbing them of their savings.

How to Buy Third Party Car Insurance Online?

The following steps will guide you to purchase third party car insurance online:

Step 1: Visit our Website InsuranceDekho.

Step 2: In the ‘Get Your Quote’ section provide your car registration number. In case you do not have it you can also provide your car’s model, make and car’s registration year.

Step 3: Enter your personal details such as name and mobile number. All the quotes in your category will be visible on your screen.

Step 4: Select the policy that suits your needs and price point.

Step 5: Make the payment for the selected policy and the policy document will be sent to your email ID.

How to Claim Third Party Car Insurance?

To get compensation for the mishap from the insurance provider the policyholder must follow the following steps:

  • The policyholder must inform the insurance company about the incident and before the stipulated time mentioned. If claims are made after this time the insurance company can reject them.
  • An FIR must be filed by the insurance holder reporting the incident at the closest police station and a copy of the same must be submitted to the insurance company at the time of filing the claim or during the process.
  • The insurance holder must follow the due process and submit the required documents for completing the claim process.
  • The insurance company will send a surveyor to check and assess the damage. After this, a report will be filed.
  • The claim will be completed based on this report.

Points to Keep In Mind While Raising A Third Party Car Insurance Claim

Here are a few things which you should consider while making a third party claim:

1. The FIR should be lodged in the case of an accident, after which the insurance company should also be intimated about the event.Without these actions, the claim process may not release the required compensation.

2. The third-party should present the relevant evidence in order to prove the mistake of the other party.

3. It is always recommended to settle the minor damage and loss cases out of court since the procedure of registering an FIR as well as the court proceedings are time-consuming.

4. No limit is set on coverage of personal damages sustained by the third party, while for the property damage, the maximum liability is limited up to Rs 7.5 lakhs.

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Third Party Car Insurance FAQ

  • What is a third party car insurance?

    A third party car insurance safeguards the policyholder against any damages or loss caused to the third party individual or third party property due to the insured car. As per the Indian Motor Tariff Act, it is mandatory for the car owners to at least get their car insured under a third party insurance plan.

  • What all is covered under a third party insurance?

    All the car owners must get insured under third party insurance to get protection against third party property damage, third party loss of life, permanent and partial disability and bodily injuries.

  • Is a third party insurance plan mandatory for all the car owners?

    Yes, as per Indian Motor Tariff Act, it is mandatory for all the car owners to at least get insured under a third party insurance plan in order to drive their vehicle on the public roads in India.

  • What is the process for getting third party insurance for my 10-year-old car?

    To opt for a third party insurance for your old car, simply visit the InsuranceDekho website and choose the ‘car’ tab. Fill in all the required information like registration number of the car, model, variant, make and click on ‘submit’ thereafter. Select the insurance plan offered by different insurance companies. Then, after making the payment you will get your policy document at your registered email-ID.

  • Can I buy a zero depreciation add-on cover along with my third party car insurance plan?

    No, you cannot purchase a zero depreciation add-on cover along with your third party car insurance plan. The add-on covers offered by various insurance companies can be purchased only with a comprehensive insurance plan or standalone own damage car insurance plan.

  • Is 3rd party insurance mandatory for cars?

    Yes, third party insurance is a mandatory insurance plan for cars.

  • Which is a better choice; a third party car insurance or a comprehensive car insurance?

    A third party car insurance offers coverage only against the third party liabilities be it property or person due to any mishap with the insured car. On the other hand, a comprehensive car insurance plan offers complete protection against both third party liability as well as own damage.

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#Applicable on non-inspection cases i.e. existing policy has not expired or when buying a policy for a new vehicle.