In India, under the guidelines of Motor Vehicles Act, 1988, buying a third party insurance plan is mandatory for every vehicle that needs to be drive on the roads. Whether, the vehicle is used for social purpose, pleasure purpose, domestic purpose or the business purpose, the vehicle should be insured under a third-party insurance plan.
Insurance is a product wherein the insurer charges the premium, to pay the owner driver of the insured vehicle, a sum of money in the event of any miss happening that causes additional expenses due to loss or damage to third party or its property.
Motor third-party insurance is a mandatory requirement under the Motor Vehicles Act. It is known as a ‘third-party’ cover because the beneficiary under this policy is third party who is someone other than two parties involved in the contract i.e. is the insurance company and owner/ driver of insured vehicle. This plan does not offers any benefit to the owner drive of the insured vehicle; however it covers his/her legal liability that might occurred due to death/injury of third party and/ or damage to its property.
What is Third Party Insurance?
There are two basic different types of insurance that helps you in the damages case. One is Third Party liability insurance and the second one is first party insurance.
A third-party insurance policy is a motor insurance plan, which offers indemnify the owner driver of the insured person, in case he or she is legally liable for damage or injuries occurred to a third party r its property respectively.
Benefits and Coverage of Third Party Insurance
- Third-party insurance is mandatory for all vehicles. This provision cannot be ignored by any clause in your motor insurance policy.
- Third-party insurance does not cover injuries or any damage to occur to the owner-driver of the insured vehicle, but to the third party who is injured by the insured vehicle.
- It provides coverage to the third party insurance that is the injured due to the insured vehicle. In such cases the insurance company pay directly to the third party or his nominee and does not even pass through the hands of the owner of the insured vehicle.
- Under third-party insurance policies the premiums remains the same even after the value of liability exceeds the estimated value because it is not possible to know the exact value of liability that might incur due to an accident.
- To avail coverage under the third-party insurance you will have to prove the fault of the insured first and also that injury occurred from the insured are covered under the plan.
If you are looking for the third-insurance plan in the market, start searching plans online. You will surely find some amazing plans with comprehensive coverage and benefits. Before buying any plan online or via insurance agent or broker make sure the policy offers coverage and benefit that you need. For further assistance to any insurance plan you can contact the customer care of the insurance company or you can take help from an insurance agents or broker.