Third Party Liability Insurance for Car / Bike (ALL you have to know) general insurance

Third Party Liability Insurance for Car / Bike

We are not saying that you are a reckless driver or you are not good in driving, but if you are on the road, accidents may happen. You may hit someone’s car or bike. The situation can get worse if the victim is a litigious person. But you don’t need to worry much if you have the safeguard of Third party Liability insurance for the vehicle. In this case, the cost of damages will be payed by your insurance company.
It is named as Third party Liability because the beneficiary of this insurance plan is not the insured nor is it the insurance company but the third party who was affected by an accident caused by the insured.  The insured is first party, the insurance company is the second party, and the person the insured injure or who claims damages is the third party.

Key Benefits

The policy is not only limited to cover the expanses of the property damage occurred to the third-party but also the death or serious injury of the third-party.
If you purchase Third Party Liability insurance policy and mishap happens while driving a car or a motor, which damages the property of another person, seriously injure or kills him, then your insurance company will bear all the expenses on your behalf.
The amount that insurance companies pay vary according to the insurance companies, for example ICIC Lombard pays up to 7.5 lakh in case of property damage of third-party, while in the case of injury or death of third party the sum insured is unlimited.

Key Limitations

As we mentioned earlier and unlike comprehensive vehicle insurance policy, this policy is only to cover the damages occurred to the third-party. Any damage occurred to self or property, in this case car or motor cycle, of the insured (first-party), the insurance company is not liable to cover any damage cost. Similarly, the policy doesn’t cover car stolen of the first-party. It is worth to be noted that the policies differs from companies to companies, therefore it shouldn’t be assumed that these key limitations are applicable by every insurance companies but it is the most likely case. For example Baharti AXA’s third party liability insurance for car/bike covers accidental death or permanent disability of insured car’s driver/owner. Whereas, Bajaj Allianz doesn’t offer such benefits to its Third Party Liability insurance policy holders.

Third Party Liability Insurance for Car / Bike in India

The Motor Vehicles Act, 1988 has made it mandatory for vehicle owners in India to avail Third Party Car Insurance.
According to IRDA June, 2014 report (provisional and unaudited) Gross premium underwritten by non-life insurers was 468.32 crore in Liability sector as compared to 413.11 of previous year.
Some insurance companies offer Third Party Liability insurance along with the comprehensive insurance policy for car and bikes, like Tata Aig and Royal Sundaram. While other sell them separately like Baja Allianz, Bharti AXA and HDFC Ergo.
third party liability insurance definition / construction /meaning

third party liability car insurance & rental car

3rd party car insurance general price almost between 1000-2000, you may notice this in your existing comprehensive policy.
lie liabilty= some of amount.
Full insurance includes vehicle value IDV + Own coverage self+ third party + service tax 14% of the price.
For rental car you can get the policy for 1-28 days  one day / temporary car insurance.
international rentals and third party liability insurance

comprehensive FULL insurance vs 3rd party liability insurance

  1. Full insurance covers you & Vehicle & third party persons who are involved in  the accident.
  2. liability insurance covers only other person (who is dead or hospitalized by you during the accident)
  3. Full insurance Covers you vehicle 5-10000 for a year but 3rd party insurance done with 1000-2000 only/-,
  4. For two-wheeler bikes its almost 535 for any vehicle.
  5. No Insurance cover under theft / damage of vehicle in liability insurance.

Reference