What is a Third Party Car Insurance?

Third-party car insurance, which is also called third-party liability insurance, covers you against any liability which can happen in case of any loss or damage caused to any third-party vehicle, person, or property. Unfortunately, it doesn’t cover your own vehicle damages.

A Third-Party Car Insurance is mandatory by the Motor Vehicles Act in India without which you will be liable for a heavy fine; whilst it also protects your pocket from any losses that could arise if your car were to damage any third-party vehicle, person or property. 

For example, if you accidentally damage another car’s headlights, your third-party car insurance will cover for the losses incurred to the third-party due to the same.

How Does Third Party Car Insurance Work?

The claim settlement process for third party car insurance can be initiated through these following steps:

• The legal representative of the deceased or the victim has to submit an application against the vehicle’s owner to claim third party liability compensation.

• Once the application has been submitted, an FIR has to be filed with the police by the policyholder of the third party car insurance, explaining the details of the accident. Keep a copy of the FIR along with the expenditures incurred by the victim for future reference.

• Next, register the case with Motor Accidents Claims Tribunal.

• You can then get compensation for the entire expense or an amount as directed by the court as there is no maximum capping on the compensation that the policyholder has to reimburse to the victim or his/her family. The maximum cover for damage of property has been fixed at a maximum of Rs.7.5 lakhs by the IRDAI (Insurance Regulatory and Development Authority).

Add-ons For Third Party Car Insurance