What Is Third-Party Car Insurance Cover and How Does It Work?

According to the Motor Vehicle Act, third-party insurance coverage is essential for all vehicle owners to drive legally on the streets of India. If someone is caught driving without a third-party insurance cover, they are punishable by law. At times, driving without a third-partycar insurancepolicy can even lead to driving license cancellation.

A third-party insurance plan offers coverage against damage to the third-party vehicle, physical injury, or personal property. But a third-party car insurance policy does not cover the insurer. Dive into this article to find out about third-party insurance coverage.

Top Features of Third-Party Insurance

Check out the features of a third-party car insurance policy to understand this type of insurance better:

  • Third-party insurance offers only a basic level of protection to the policyholder.
  • Third-party insurance won’t provide any protection to the insured car itself.
  • It is often called the act-only or liability-only policy.
  • Third-party insurance policies come with more affordable premiums than comprehensive covers.

How Does Third-Party Vehicle Insurance Work?

When a policyholder is in an accident, third-party car insurance covers the financial burden associated with a third-party vehicle or property repair and third-party physical injury expenses. Therefore, the financial burden on the policyholder gets reduced.

When involved in an accident, the policyholder must inform the insurer before making a third-party car insurance claim. Once you have made a claim, the insurer will evaluate the damages and the estimated cost of repairs. After the verification is over, the insurer will settle the claim.

How to Make a Third-Party Car Insurance Claim?

After informing your insurer, you will have to do the following to file a third-party car insuranceclaim:

  1. File an FIR with details about the claim. Keep a copy of the FIR with you to provide to your insurance company while filing the claim.
  2. The claim goes to the Motor Accidents Claim Tribunal, which determines the amount that you will have to pay for causing financial losses to the third party.
  3. Your insurer will pay the amount on your behalf and compensate the third party.

Nowadays, you can easily make a third-party car insurance online claim without having to run to your insurer’s office multiple times.

Documents Required to Make a Car Insurance Claim

The documents required to make athird-party car insuranceclaim are as follows:

  • Claim form with the required details and your signature
  • A copy of your insurance policy
  • A copy of the police FIR
  • A copy of your driving license
  • A copy of your identity proof
  • A copy of other police reports

Third-Party Car Insurance Plan Exclusions

When you buy third-party car insurance online, you won’t have to worry about the financial expenses associated with third-party damage. You will be covered against physical injuries, damage to the property, damage to the vehicle, and even death. But you won’t get any coverage under third-party insurance if:

  • The accident took place due to driving under the influence of drugs or alcohol.
  • The driver was driving without a license or falls below the legal driving age in India.
  • The accident was caused deliberately.
  • The vehicle gets stolen.
  • The vehicle was used for illegal activities.

Is Third-Party Insurance Enough?

From a legal standpoint, buying third-party car insurance online is adequate to satisfy the requirements of the Motor Vehicles Act. If you have the coverage, you can stay out of trouble with the law. But the third-party policy clearly falls short when seen from the perspective of coverage.

The policy does not cover natural or man-made disaster-related damages to your car. Also, if the car is stolen, 3rd party car insurancewon’t compensate for your losses. If you are looking for a wider scope of coverage, you will have to rely on a comprehensive vehicle insurance policy.

When you buy comprehensive car insurance online, you will be covered for the mandatory third-party legal liability and the damages your own vehicle suffers. You will also get covered when your car gets stolen. Furthermore, you can buy add-on covers to receive 360-degree coverage.

Wrapping up

Buy 3rd party car insurance to protect your vehicle against legal issues and get compensated for third-party liabilities. But if you want to be safer while driving, you should choose a comprehensive car insurance cover and receive added protection. You can customize your comprehensive car insurance policies with add-on covers and get 360-degree protection without financial concerns.


  1. Can you buy car insurance online?

Nowadays, you can easily buy car insurance online in a hassle-free manner. Choose a reputable insurance provider and browse through their different plans to pick the best one for you. From submitting documents to paying the premium, you will be able to do everything online. Moreover, you can also easily renew your vehicle insurance policies online.

  1. What are the two types of car insurance policies?

You can buy third-party car insurance or comprehensive coverage car insurance. All drivers in India legally require a third-party car insurance policy. It is a basic type of insurance that only offers compensation for third-party damage. But comprehensive car insurance policies offer third-party liability coverage and added protection for the policyholder.

  1. What is the problem with third-party car insurance?

Third-party car insurance does not offer any protection to the insured car. Instead, it will offer protection against third-party damage caused by the insured vehicle. It can offer protection against third-party property damage, vehicle damage, and even physical injuries.

  1. Is third-party car insurance useful?

Third-party car insurance is useful when the insured car gets involved in an accident and causes third-party liability. The third-party offers compensation for the damage caused by the insured car.

  1. How much do you need to pay for third-party car insurance premiums?

Third-party car insurance offers only basic coverage to policyholders. Therefore, the premiums for third-party insurance covers are quite affordable.