The other day, while talking to a neighbour, I suddenly remembered that I had forgotten to pay my third-party car insurance premium. We were discussing a gruesome incident that had happened just a few days ago. A biker was severely injured due to the rash driving of a car. The driver was driving the car, and when the passersby and the traffic police stopped him, he had no idea about the type of four-wheelers insurance the car owner had bought along with the vehicle. He wasn’t educated enough to understand the differences between the various online car insurance policies. But today, even the much-educated ones fail to opt for the necessary insurance plans before hitting the road.
According to the Motor Vehicles Act, 1988, every Indian with a bike or a car must have at least third-party car insurance to drive on the roads safely. The drivers will be fined ₹2000 for a one-time offence and ₹4000 for repeated offences without the same. So, what is this third-party insurance plan? Let’s get into the details of the same below.
What is Third-party Insurance for Cars?
These days, reports of road accidents are common in the country. While it hits us like a shock wave, the fact is, very few of us follow the rules when it comes to driving on the road. Even if you think you always maintain road safety, the other person with his car or bike might get into a road rage that can harm you or your vehicle. Impatient driving is common in both new and experienced drivers. The road conditions and poor infrastructure, coupled with inadequate safety measures, act as catalysts for such fatalities.
Third-party car insurance is one such plan which is mandatory for every car owner in India. It is a type of online car insurance policy that provides financial protection to a third party for damage or loss sustained by them during an accident with the insured car. This policy is often termed a third-party liability cover or a liability-only plan, and it doesn’t provide any coverage to the policyholder or the insured.
How Does Third-party Car Insurance Work?
To make it easier for you to understand, let’s take an example. Suppose you are the third-party policyholder of your car, and you meet with an accident. During which, your car damages another vehicle on the road, along with providing its driver with minor cuts and bruises. So, with your third-party car insurance in place, you will be offered financial aid by your insurer to pay for the costs of repair to the other vehicle and its owner’s treatment. Thus, it will reduce the financial burden off your shoulders.
First, however, you must inform the insurance company about the mishap immediately before filing your car insurance claim during such an event. Once the claim is filed, the company will appoint a surveyor or reviewer to assess the damages and verify the estimated fees for repairs. And after the completion of the verification process, your insurer will settle the claim.
Third-party Car Insurance Inclusions and Exclusions
This simple chart will help you understand what is included in and excluded from third-party insurance for four-wheelers in India.
|Damages to the third party by the insured vehicle.||If the accident was caused because the driver was under the influence of alcohol or any other intoxicating substance.|
|Physical injuries to the third party, including death and disability.||If the driver is underaged. Or if the driver was found guilty of driving without a valid driving license.|
|Damages to the vehicle of the third party.||If the accident was a deliberate act by the offender.|
|Damage to the property of the third party.||If the vehicle was being used for any commercial purposes or illegal activities during the accident.|
|Personal Accident Cover for the owner-driver.||If the driver of the insured car is involved in an accident outside the geographical area mentioned in the policy.|
Benefits of Third-party Car Insurance
Some of the significant benefits of opting for third-party insurance for your car are listed below:
- Peace of Mind: Such insurance plans can offer you peace of mind during an unforeseen incident on the road. You will not have to worry about your finances as you will know that your insurer will settle the claim and pay for the same.
- Legal Coverage: With third-party car insurance, you will be saved for any legal liabilities as the beneficiary of this policy would be the injured third person. So, in case of death or disability to any third party due to an accident caused by your car, you will be protected against both financial and legal liabilities whatsoever.
- Hassle-free Buying Process: If you research extensively about the insurer before opting for third-party insurance for your car, you can enjoy an absolutely easy and hassle-free purchase procedure online. Also, make sure that you understand their car insurance claim processes well in advance to save yourself from any hiccups in the future.
- Affordable Policy: The fact that third-party car insurance plans are made mandatory by the law for every four-wheeler owner in India, the premiums paid for this plan are not high. However, the premium charges will vary from one insurance company to another. It will also depend upon the make and model of the vehicle, its IDV, and so on. So, to calculate car insurance premiums online, be aware of how much you will need to pay to get the assured coverage.
So, now that you are well aware of the terms and conditions of third-party car insurance plans and how they work, you must consider opting for one in case you have just bought a car or are going to buy one shortly. However, like me, as mentioned at the start of this article, do not forget to pay your insurance premiums on time.
Always remember, your safety is in your own hands. Hence, follow the law, maintain road safety and also be responsible enough to provide everyone else on the road with a safe driving/walking/riding environment.