Demystifying Third-Party Car Insurance: Everything You Need To Know For Budget-Friendly Coverage
This insurance does not cover damages to your own vehicle, but it ensures that you are financially protected in case your car causes harm to others on the road.
New Delhi (India), August 31: Third-party car insurance is a type of auto insurance that provides coverage for the damages or injuries caused to a third party by your vehicle. It is a mandatory insurance policy in India under the Motor Vehicles Act, 1988. This insurance does not cover damages to your own vehicle, but it ensures that you are financially protected in case your car causes harm to others on the road.
Features and Benefits of Third-party Car Insurance
- Legal Compliance
It is mandatory by law to have third-party car insurance to drive on Indian roads.
- Financial Protection
Third-party insurance covers the costs of damages caused to another person's vehicle or property in an accident, saving you from potential financial liabilities.
- Personal Injury Coverage
It provides coverage for bodily injuries or death caused to a third party due to your car's involvement in an accident.
- Peace of Mind
With third-party insurance, you can drive confidently knowing that you have coverage for third-party liabilities.
- Cost-effectiveness
Compared to comprehensive insurance, third-party car insurance tends to be more affordable.
Quick and easy to obtain: The process of getting third-party insurance is usually straightforward and can be done quickly.
- No-claim Bonus
You can earn a no-claim bonus for each claim-free year, reducing your premium for the subsequent years.
- Protection Against Legal Penalties
If caught driving without insurance, you could face hefty fines or other legal consequences. Third-party insurance helps avoid such penalties.
- Coverage for Property Damage
It protects you from paying hefty amounts for damages to someone else's property, such as another vehicle, building, or infrastructure.
- Peaceful Resolution of Disputes
In case of an accident involving a third party, insurance companies can help mediate and resolve disputes, ensuring smoother claim settlements.
Keep in mind that while third-party insurance covers damages to others, it does not provide coverage for your vehicle's damages or theft. For comprehensive coverage, you would need to consider a comprehensive car insurance policy.
Where Can You Get Third-party Car Insurance?
In India, you can buy third-party car insurance plans from various sources, including:
- Insurance Companies
You can purchase third-party car insurance directly from insurance companies by visiting their official websites, contacting their customer support, or visiting their local branches.
- Insurance Agents
Insurance agents, who work on behalf of insurance companies, can assist you in buying third-party car insurance. They can provide information, guidance, and help you choose the right plan based on your requirements.
- Insurance Aggregators
Online insurance aggregators are platforms that allow you to compare and purchase insurance plans from multiple companies. These platforms offer a convenient way to review different options and select the most suitable third-party car insurance online.
- Banks
Some banks in India also offer third-party car insurance plans. You can inquire at your bank about the availability of such policies and their features.
Remember that third-party car insurance is mandatory in India as per the Motor Vehicles Act, and it covers any legal liability arising due to damages caused to third-party property or injuries to third parties caused by your car. For comprehensive coverage, you may also consider purchasing a comprehensive car insurance policy that includes both third-party liability and coverage for own-damage to your vehicle.
How Are Premium Prices Decided?
Premium prices for third-party car insurance are decided on the basis of the cubic capacity of the car. Hence, the premium prices as of July 2023 are stated below.
- Not exceeding 1000 cc: ₹2,094
- Exceeding 1000 cc but not exceeding 1500 cc: ₹3,416
- Exceeding 1500 cc: ₹7,897
Note: The aforementioned rates are applicable to private cars only. The prices may differ for commercial and/or passenger vehicles.
Other Options
While third-party car insurance is a legal requirement, there are alternative insurance options available that offer more extensive coverage for your own vehicle. These alternatives are:
- Comprehensive Car Insurance
Comprehensive insurance not only covers third-party liabilities but also provides protection for damages to your own vehicle due to accidents, theft, natural calamities, fire, vandalism, etc. It offers a more extensive and inclusive coverage compared to third-party insurance.
- Package Policy
This type of policy combines the benefits of third-party coverage with additional add-ons. It allows you to customise your insurance by choosing specific covers like personal accident cover, roadside assistance, engine protection, zero depreciation, and more.
- Bundled Policies
Some insurers offer bundled policies where they combine various insurance products, such as car insurance, health insurance, and home insurance, into a single package. This can often result in cost savings and convenience.
Conclusion
Third-party liability car insurance is a mandatory policy that provides coverage for damages or injuries caused to a third party by your vehicle. It ensures legal compliance and offers affordable protection for third-party claims.
While third-party insurance is a legal requirement, you also have the option to consider more comprehensive insurance policies that offer coverage for your own vehicle and additional benefits through package policies or bundled insurance plans. Before making a decision, it is crucial to compare different insurance options, assess your needs, and choose the one that best suits your requirements and budget.
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