When the insurance coverage is for a party who is not a part of the contract between the insurance company and the person insured but gets affected, it is termed as third party insurance. While, it does not help the person by insuring them directly, but is still beneficial since it discharges him from any liability to a third party or property he has inadvertently caused damage to.
Third party car insurance is the minimum legal requirement for owning and driving a motor vehicle in our country according to the Motor Vehicles Act, 1988. This insurance or liability cover safeguards the interest of the vehicle owner or driver against legal liability, injury or even death of the third party or property due to an accident in which the vehicle is involved. When a loss (monetary, disability, injury or loss of life) is suffered by a third party, a claim can be made from the insurance company of the vehicle in question.
All insurance companies offer third party insurance, which is the basic requirement, and it is usually sufficient if you do not take your car out too often. If your car is very old and you want to avert a situation of loss and liability, a minimum liability-only or third-party insurance is good to have.
Benefits of Third Party Insurance
Third party insurance policies offers several benefits to the vehicle owner. Let’s take a quick look.
Gives Much-Needed Peace of Mind
Unforeseen expenses can be a huge cause of worry, particularly when you have to make payments for damages that you accidentally inflict on a third party. This policy covers any liability you owe to a third party, relieving you of a major stress in situations when you already have a lot to deal with.
Cost-Effective and Beneficial to Vehicle Owne0072
Third party car insurance plans save on valuable cost for the owner because if it is a third party liability-only plan, the premium rates are usually affordable as the premiums are determined by the IRDAI. You can seek a liability cover against third party damages without breaking the bank. In the event of an unforeseen event such as an accident, the vehicle owner does not have to bear the brunt of a financial burden.
Simple and Quick Method of Insurance
Easy to buy and renew, premium third-party insurance plans do not require much paperwork. You can fill your form, make the payment and receive the policy documents. A vehicle inspection may or may not be necessary depending on the policy of your insurance company.
Legal Cover Against Third-Party Losses
Third party insurance indemnifies against losses or damages you may incur to a third party when you are out with your vehicle on the road. For instance, in case of an accident, your insurance company will cover all damages to the third party in terms of life and property but you do not stand any chance of coverage if you were also injured in the unforeseen event.
Drawbacks of Having Third Party Insurance
While third-party car insurance is beneficial in many ways and saves a policyholder from legal issues after an unforeseen situation, there are some disadvantages of having such a policy.
No Cover Against Personal Accident
This policy covers injuries, death or disability caused to the third party, but the policyholder does not get any coverage in case he also suffers injuries in the road accident.
No Cover for the Owner’s Vehicle
There is no cover provided in the event of loss, theft, fire accident, or damage to your vehicle if the blame lies with you. The cost of all repairs and corrective action you take for your vehicle will have to be borne by you.
Not Much Cost Benefit
Third party insurance is very popular today, and due to its increasing popularity among young owners, it may not be as cost-effective as you think. The value you derive from a comprehensive policy may be far more than this for the extra premium payment.
There are several factors that let you decide when you should opt for a third party insurance policy. If the value of your car is not very high, you can choose to indemnify yourself from third party liability only. Additionally, when the usage of your car is restricted, and it is parked in the garage most of the time, the chances of a mishap are minimised. Third party insurance works out ot be more cost-effective in such situations. Turn to an expert such as Coverfox.com to guide you on how to go about choosing a good insurance service provider and getting the best third party insurance quote for your vehicle.