Third-party car insurance provides coverage for any damages or injuries caused to the third party involved with the accident caused by the policyholder.
Car insurance is an essential purchase for anyone who owns a car. It acts as a protective shield for your car and savings against unforeseen damages or losses. Third-party car insurance is one of the most common types of car insurance policies available. It is the minimum level of vehicle insurance required by law in India. But what exactly is third-party car insurance? And why is it so important? This article helps demystify third-party car insurance and lets you understand why it is a key protection for every vehicle owner.
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What is Third-Party Car Insurance?
Third-party car insurance is the most basic level of car insurance coverage. It covers the third party whom the policyholder is liable to pay for resulting from any third-party vehicle damages or personal injuries in an incident related to the policyholder’s vehicle. In simple terms, it covers any damage or injury caused to someone else's vehicle or property, caused by the insured’s vehicle.
As per the Motor Vehicles Act of 1988, every vehicle owner must have at least a minimum level of third-party car insurance. This is to ensure that if you are involved in an accident or damage someone else's property in an accident, the third party is protected financially. Third-party car insurance is not only important to keep the law enforced, but also makes a common-sense solution for protecting car owners against high financial losses.
What Does Third-Party Car Insurance Cover?
Third-party car insurance provides coverage for any damages or injuries caused to the third party involved with the accident caused by the policyholder. While the policyholder’s car and the driver are not covered, third-party insurance is still a useful investment and can spare the policyholder from costly liability expenses that may arise from an accident.
Third-Party Car Insurance Provides Coverage For The Following:
Damage to Third-Party Property - Third-party car insurance protects policyholders against property damage. It covers the costs of repairs or replacements of any vehicle, building, or structure damaged in an accident caused by the policyholder. However, it does not cover the policyholder’s vehicle damages.
Bodily Injury to Third-Party - If an accident results in any bodily injury to the third party, the policyholder is responsible for compensating for the medical expenses of the injured person, their loss of wages, and any other related expenses. Third-party car insurance covers these expenses, ensuring the policyholder’s financial stability in such situations.
Personal Accident for Policyholder - It also compensates the policyholder for any injury caused during the accident. It covers all the costs of treatment for the injuries suffered by the policyholder.
What Doesn’t Third-Party Car Insurance Cover?
While third-party car insurance policies provide convenient coverage, there are certain scenarios in which they do not provide coverage. The scenarios are as follows:
Damage to the Policyholder's Vehicle - This is the most significant thing that third-party car insurance does not cover. Third-party car insurance is designed to compensate for the damage caused to the third party involved in an incident. It favours the interests of the third party over the policyholder. Thus, it does not cover damages caused to the policyholder's car or motorbike.
An Injured Passenger - Third-party car insurance covers accidents involving only third parties. If a passenger is injured because of the driver's lapse, the policyholder is liable to pay compensation to the third party. However, third-party car insurance does not provide coverage for the injured passenger's medical expenses.
Non-Collision Damages - It doesn’t cover any damages or theft to a vehicle if the vehicle is not in collision with another vehicle.
Conclusion
Third-party car insurance is a minimum insurance policy that is mandatory for every car owner. It provides a safety net to the policyholder when the car causes damage to other vehicles or any third party. It is always advisable to consider additional coverage, but third-party car insurance is critical in ensuring that you meet the minimum required legal standards. Every driver on the road is a potential threat, making third-party car insurance invaluable.
To ensure one's safety, it is best to compare the price and performance of third-party policies available in the market and choose the policy that is best suited for a driver’s needs. By doing this, you can save yourself from the hefty expenses that may arise from unforeseen situations. This is where Bajaj Finance Insurance Mall can help. It offers a user-friendly interface to help you explore various policies and coverage options and choose the policy that suits your requirements and budget.
Disclaimer:
T&C Apply. Bajaj Finance Limited (‘BFL’) is a registered corporate agent of third party insurance products of Bajaj Allianz Life Insurance Company Limited, HDFC Life Insurance Company Limited, Future Generali Life Insurance Company Limited, Bajaj Allianz General Insurance Company Limited, SBI General Insurance Company Limited, ACKO General Insurance Limited, ICICI Lombard General Insurance Company Limited, HDFC ERGO General Insurance Company Limited, Tata AIG General Insurance Company Limited, The New India Assurance Company Limited, Cholamandalam MS General Insurance Company Limited, Niva Bupa Health Insurance Company Limited , Aditya Birla Health Insurance Company Limited, Manipal Cigna Health Insurance Company Limited and Care Health Insurance Company Limited under the IRDAI composite CA registration number CA0101. Please note that, BFL does not underwrite the risk or act as an insurer. Your purchase of an insurance product is purely on a voluntary basis after your exercise of an independent due diligence on the suitability, viability of any insurance product. Any decision to purchase insurance product is solely at your own risk and responsibility and BFL shall not be liable for any loss or damage that any person may suffer, whether directly or indirectly. Please refer insurer's website for Policy Wordings. For more details on risk factors, terms and conditions and exclusions please read the product sales brochure carefully before concluding a sale. Tax benefits applicable if any, will be as per the prevailing tax laws. Tax laws are subject to change. BFL does NOT provide Tax/Investment advisory services. Please consult your advisors before proceeding to purchase an insurance product. URN No. BFL/Advt./23-24/227.
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