Third Party Car Insurance Starting at Rs. 2094*

Third-party car insurance covers third-party related liabilities incurred due to an accident from an insured vehicle. This insurance gives compensation in case of death, injury, or damages caused to a third party.
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Third-party Insurance
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3 mins
14-May-2024

As per the Motor Vehicles Act 1988, every four-wheeler owner in India needs to buy a third-party car insurance policy. It covers only third-party liabilities. Car insurance holders get coverage if any loss or damage caused to the property or life of any third party.

What is third-party insurance?

Third-party car insurance is a basic motor insurance policy that every four-wheeler owner must have. It financially covers the policyholder against any losses or damages caused to a third party’s property or if the person suffers physical injury or death. The Motor Vehicles Act of 1988, also mandates buying third-party policy at the time of purchasing a new vehicle.

Key features of third-party car insurance

Here’s a quick look at the key features of third-party insurance.

Key features

Description

Liability coverage

Covers damage or injury caused to a third party.

Legal protection

Offers legal assistance in case of a legal dispute.

Property damage coverage

Covers repairing cost of someone else's property.

Personal accident coverage

Provides financial coverage for injuries or death of the policyholder.

Third-party injury coverage

Covers medical expenses for injuries sustained by a third party.


Key benefits of third-party car insurance

Here’s a list of top benefits of a third-party insurance for car.

• Coverage for third-party liabilities

Get financial coverage if any damage, death, or loss caused to a third party due to any mishap or accident.

• Affordable premium

Third-party insurance policies are usually available at a low monthly premium. This ensures you have the insurance coverage you need for your vehicle without having to spend a huge amount of money.

• Peace of mind

A third-party car insurance policy ensures peace of mind. As it provides financial coverage against any accident or mishap that might involve a third party.

• Easy online process

You can purchase a third-party insurance policy online with zero paperwork in just a few clicks.

Third-party insurance premium rates

The Insurance Regulatory and Development Authority of India fixes the third-party car insurance premium based on the engine’s cubic capacity (CC). Premiums for these policies are generally lower than the comprehensive car insurance policies.

Following are the premiums set for third-party insurance policies for old, new, and electric cars.

Third-party car insurance premiums for the old cars

Cars with engine CC

Premiums

Up to 1,000 CC

Rs. 2,094

1,000-1,500 CC

Rs. 3,416

More than 1,500 CC

Rs. 7,897


Single premiums set for three years third-party car insurance policies

Cars with engine CC

Premiums

Up to 1,000 CC

Rs. 6,521

1,000-1,500 CC

Rs. 10,640

More than 1,500 CC

Rs. 24,596


Single premiums set for three years third-party insurance policies for electric vehicles

Cars with engine CC

Premiums

Up to 30 KW

Rs. 5,543

30–65 KW

Rs. 9,044

More than 65 KW

Rs. 24,907


Factors that affect third-party car insurance premium

  • Vehicle make and model: Luxury or high-performance cars often incur higher premiums.
  • Age and experience of the driver: Young or inexperienced drivers may face increased rates.
  • Location: Urban areas typically have higher premiums due to higher accident rates.
  • Claim history: Previous claims can raise premiums.
  • Coverage limits: Higher coverage limits lead to higher premiums.
  • Add-ons: Extra coverage options can increase costs.
  • Deductible amount: Lower deductibles mean higher premiums.

Understanding these factors helps in making informed decisions when purchasing third-party car insurance.

Also read: Parivahan Sewa

What is covered under third-party insurance?

Below are some key inclusions under a third-party insurance:

Third-party liabilities

Third-party liabilities in a third-party car insurance policy refers to the damages or injuries caused by the insured car to a third party. This is applicable under the following circumstances:

  • Property damages: Covers costs for damages caused to third-party property by your vehicle, including repair or replacement expenses.
  • Bodily injury: Provides financial protection for injuries or death caused to third parties by your vehicle, including medical expenses and legal fees.
  • Car damages: Third-party insurance also covers damages to the third party's vehicle caused by your vehicle during an accident.
  • Accidental death or disability: Third-party car insurance provides coverage if an accident involving the insured vehicle results in the death or disability of a third party.
  • Personal accident cover: Offers compensation for accidental injuries or death to the insured driver, regardless of fault. It also extends coverage to passengers in the insured vehicle in case of accidents, providing financial support for medical treatment or loss of income.

What is not covered under a third-party insurance?

Understanding the limitations of third-party car insurance is crucial to avoid unexpected expenses. Here are aspects typically not covered:

  • Own vehicle damages
    Repairs or replacement costs for your own vehicle in case of an accident are not covered.
  • Personal injuries
    Medical expenses for injuries sustained by you or your passengers are excluded from third-party insurance coverage.
  • Theft or fire damage
    Losses due to vehicle theft, fire, or vandalism are not covered under standard third-party policies.
  • Add-on benefits
    Additional features like zero depreciation cover, roadside assistance, or engine protection are not included in basic third-party insurance.
  • Consequential damages
    Damages that result indirectly from an accident, such as loss of personal belongings, are generally not covered.
  • Driving under influence
    Accidents that occur while driving under the influence of alcohol or drugs are not covered under third-party insurance.

It's advisable to consider comprehensive car insurance for broader coverage, ensuring protection against a wider range of risks beyond basic third-party liabilities. Always review policy terms to understand exclusions and limitations.

Comprehensive vs third-party car insurance policies

Below are the major differences between comprehensive and third-party insurance for car.

Feature

Comprehensive car insurance

Third-party car insurance

Coverage

Covers damages caused to the insured vehicle and third-party liabilities. Third-party liabilities include damage to the property or injury or death of a third party.

Covers the policyholder only against third-party liabilities. Third-party liabilities include damages caused to the third party’s vehicle or property, or any physical injury caused to them in an accident.

Add-ons

Flexibility to add add-on covers. You can add consumable cover, engine protection cover, zero depreciation cover, or roadside assistance cover. Also, NCB protection cover, key replacement cover, and more to the basic car insurance policy.

There are no additional covers available on third-party car insurance policies.

Cost

As comprehensive car insurance offers an extensive coverage, the premium comes at a comparatively higher price.

These policies are relatively cheaper than comprehensive plans due to restricted coverage.


Why should you buy third-party car insurance policy?

Having a third-party insurance policy is always beneficial. The policy covers you in case of any unfortunate eventuality.

Financially beneficial:

Third-party car insurance online will protect you from heavy fines and damage costs of a third party.

Cost-effective:

Third-party insurance is cost-effective and provides long-term benefits compared to other plans.

Licence protection:

Third-party car insurance safeguards against the seizure of a driving licence.

Legal protection:

Third-party car insurance online saves policyholders from time-consuming legal hassles.

Safety net:

Third-party insurance provides a personal accident cover of up to Rs. 15 lakh.

How to buy a third-party car insurance online?

You can simply buy a third-party insurance for car online in just a few steps.

  • Visit the preferred insurance company’s website.
  • Search for third-party car insurance policies and fill the application form.
  • You need to share a few personal details like name, mobile number, and residential address.
  • Also, provide details about your vehicle.
  • Carefully go through the details entered and submit.
  • Make the payment through any of your preferred online payment modes.

How to renew third-party car insurance online?

Simply visit your insurer’s website to renew your third-party insurance online. Enter the details of your previous car insurance policy and make the payment to get the policy instantly. You will receive the renewed 3rd party car insurance documents on your registered mail.

If you wish to change the insurer, you can visit your preferred insurance company’s website. Search for third-party insurance and apply online. Here too, you need to fill in some personal details and your previous policy number. Make the payment online and get your policy.

How to raise a claim request for third-party car insurance

It is quite easy to file a claim against your third-party insurance policy. Here are the steps to follow:

Step 1: Inform the insurer about the accident that involves third-party loss or damage.

Step 2: Provide all necessary details about the accident to the insurance provider. Give details like time and place of the mishap, eyewitness. Also, photos of the incident, details of the policyholder and the insurance policy and others.

Step 3: The insurance provider will verify all details as well as the documents provided and settle the claim with the third party.

Frequently asked questions

What is a third-party insurance for car?

A third-party insurance for car keeps you financially secure against third-party liabilities. You get coverage against any damages caused to the third party because of an accident where you are at fault. Covers the damages caused to the third party’s property or vehicle. Also, if injured or caused death to the third party in the accident. Third-party car insurance policy also covers the legal expenses incurred, if any.

What is the sum insured on third-party insurance?

Third-party insurance gives coverage up to Rs. 7.5 lakh. The third party gets the compensation against any damages caused to their property or vehicle, injury, or death suffered in an accident. The third-party car insurance holder files the claim for the accident caused from his/her car.

Is third-party insurance mandatory for cars?

Yes. The Motor Vehicles Act mandates every vehicle owner to have a third-party car insurance policy. If you drive without a valid policy, you may legal consequences.

Is third-party insurance enough for my car?

An online third-party insurance covers only third-party liability. Covers the accidental damages or bodily injury caused to the third party. Third-party car insurance does not cover damages caused to the policyholder’s car. The policyholder will have to pay the repairing cost for the car damages from their pocket.
A comprehensive car insurance policy covers both own damages and third-party liabilities. You also get personal accident cover.

Which is better first-party or third-party insurance?

First-party car insurance refers to comprehensive car insurance policy that offers coverage for both own damages and third-party liabilities. A third-party car insurance covers only the third-party liabilities. You can choose any type of the car insurance policies as per your requirement and budget.

Does third-party insurance cover death?

Yes, third-party insurance covers injury or death of third party. The third party gets compensation up to Rs. 7.5 lakh based on the damages incurred.

Can we drive a car just with a third-party insurance?

Yes, you can drive a car on Indian roads just with a third-party insurance. Every vehicle owner must have a third-party car insurance to comply the law as per the Motor Vehicles Act. If caught driving a car without a valid third-party insurance, you may have to pay a fine of Rs. 2,000. In some cases, your driving licence may get confiscated.
To avoid such consequences, you can buy/renew a third-party car insurance online.

Can I cancel the third-party car insurance policy?

Yes, you can cancel your third-party car insurance policy at any time by contacting your insurance provider and informing them of your decision. However, note that cancelling your policy before its expiry date may result in a cancellation fee or other charges. So, check with your provider first if there are any such charges before you proceed.

What should I do in case of an accident covered under my third-party car insurance?

In case of an accident covered by your third-party car insurance, you should immediately report the incident to your insurance provider. Depending on the severity of the accident, you may also need to obtain medical help, file a police report, and take photos of the damage. Your insurance provider will then assess the situation and guide you on the next steps.

What is the policy term of a third-party policy?

The policy term of a third-party car insurance policy varies depending on the chosen policy and the terms and conditions set by your insurance provider. Generally, insurance policies can last anywhere from twelve months to three years. You also get insurance policies for a short term. Check with your provider for the exact duration of your policy.

Will third-party insurance cover the damages if someone else was driving my car and got into an accident?

Mostly, third-party insurance covers the damages and expenses caused to the third party if the person driving is at fault. You should ensure that you have named drivers on your policy. Also, ensure that the policy covers the person driving your car at the time of the accident, before making a claim. If the policy does not cover the person driving your car, the chances of the insurance company not covering the damages are likely. However, the scope of coverage may vary depending on the insurer’s terms and conditions.

Can I have 2 third-party insurance?

No, you cannot have two third-party insurance policies for the same vehicle simultaneously. Each vehicle can only have one valid third-party insurance policy at a time. However, you can opt for additional coverage with a comprehensive insurance policy alongside third-party insurance.

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