Buying car insurance can be easy if you do your due diligence. For a safe driving life, here are a few key points on third party insurance:
- What is Third Party Insurance ?
Third party car/motor insurance is a legal necessity in India for every vehicle owner. A third-party car insurance policy protects the policyholder against the liability of accidental damages caused to a third party.
The policyholder is the First Party, the insurance company is the Second Party and the person claiming damages from the First Party is the Third Party. Hence, the beneficiary of a third party insurance is the Third Party, regardless of whether they are insured or not.
Thus, in case of an accident the insurer will pay for the damages caused TO a third party but not for damages caused to the first party, i.e. the policyholder.
The other type is a comprehensive car insurance policy which covers Own Damage (OD) along with Third Party Liability and offers additional features, termed as Add-On covers to give you an extensive coverage.
- What is covered and what is not covered under a Third Party Insurance Policy ?
|Bodily injury to a Third Party||Bodily injury to policyholder|
|Damage to property of Third Party||Damage to property of policyholder|
|Permanent Total Disability to a Third Party||Permanent Total Disability to policyholder|
|Accidental Death of Third Party||Accidental Death of policyholder|
- Who can file a Third Party Claim and Where to File it ?
Under the Motor Vehicles Act,1988, a third party claim can be filed by affected third party or his/her legal envoy (in case of deceased) in a Motor Accident Claims Tribunal at the site of accident/at the place where the owner or involved driver resides/injured person or dependents’ habitat. No civil court can decide on third party insurance claims.
- What is the procedure for filing a Third Party Claim ?
There are several steps to filing a claim as follows :
– In case of an accident, immediately contact police and file an FIR containing the registration number of vehicle involved in accident, license number of driver and the name and contact details of witnesses, if any. This is crucial as the FIR is mandatory when filing the claim.
– Inform the insurance company about the accident within 48 hours of the accident in order to secure a claim. If you delay informing the company, your claim can be rejected.
– File a case with the Motor Accident Claims Tribunal having jurisdiction over the site of accident or residence of owner/victim.
– Gather all documents pertaining to claim- FIR , photos of the accident site, damaged property and injuries suffered and original reports, receipts, bills etc. of any and all costs incurred by the victim to authenticate loss/damage.
- What is the limit of compensation which the insurance company will bear ?
The Tribunal court decides the amount to be paid as compensation. There is no limit defined for liability in case of injury or death but the compensation in case of damage to property is capped at ₹ 7.5 Lakh. In case damage exceeds cap amount, the policyholder will bear the cost.
Be thorough before buying third party car insurance and secure your driving experience.