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Apr 5, 2021

Third Party Motor Insurance

Motor insurance finds a mention in the news every few days. More recently, the discussion around motor insurance has been due to the change in regulations with respect to coverage of an insurance policy.   It is mandatory by law for every vehicle plying on Indian roads to have a valid motor insurance. When looking for a motor insurance policy, there are two options available - Comprehensive or Third-Party. You can opt for either of them, but the minimum requirement as per law is of a motor third-party liability insurance policy. It is one of the most economical insurance covers that you can buy while complying with the legal requirements.   Now, let us look at the five must-know things about third-party motor insurance -  

What is third-party motor insurance?

Under third-party insurance cover, the insurer agrees to indemnify the policyholder in case there is a legal obligation for the injuries or damages to any third party in case of an accident. For instance, an accident where you are at fault, the cost of damages to any such person or entity can be covered by the insurance company. The third-party motor insurance policy does not cover the cost of damage to your vehicle.  

What are the events covered under motor third-party liability insurance?

A 3rd party car insurance or bike insurance policy covers cases of injury or death in case of an accident. Permanent disabilities that take place due to an accident for a third party individual are also covered under third-party insurance plans. Damage or destruction of any property due to an accident is covered up to a specified limit of ₹ 7,50,000 with this insurance.  

Who can file a claim using third party motor insurance?

The affected person or entity, in case of an accident, can file a claim using the third-party motor insurance policy of the person whose fault it was. It can be submitted at the tribunal under whose jurisdiction the accident took place or where the owner resides or the place of residence of the injured person or his dependants.  

What are the exclusions under a third-party motor insurance policy?

  • A third-party insurance policy does not cover any damages to the vehicle of the policyholder. In case you meet with an accident, then the damages to your vehicle as well as any injuries sustained by you will not be included under your policy coverage.
  • The regulatory body, Insurance Regulatory and Development Authority of India (IRDAI), has set limits for reimbursement in case of damage to property due to an accident. This claim has an upper limit of ₹ 7,50,000. It implies any damage over and above this amount shall not be covered under by your insurer. However, this capping does not apply in case of injuries or death or permanent disability for the other person. In such cases, the entire cost of treatment is covered by the insurance company.
  • Any other terms and conditions specifically laid down by the insurer need to be abided while making an application for the claim. If the terms and conditions are not followed, your claim can get rejected.

The process of third-party motor insurance claim

The first and foremost step is informing your insurance provider via any medium possible once the accident has occurred. The next step is approaching the insurer with a claim application. Such an application can be made by the injured, the owner of the property or the legal representative of the injured.   The insurance company would then process the claim, which could include taking the arbitration to the tribunal to ensure that the compensation paid for cost of treatment of the injured or for the loss of life is adequate.   This is the minimum that you must know about a third party motor insurance. Having this information will certainly help you in case a need arises. You can avail a car or two wheeler insurance third party cover for your vehicle online as well with Bajaj Allianz.    

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