How Does Third Party Car Insurance Work?

Car Insurance

India’s regulators have made car insurance compulsory. Third-party liability insurance is required under the Motor Vehicles Act, and if the automobile owner-driver is caught without it, he may be penalized. But what exactly is third-party liability automobile insurance? Before you invest in this policy, be sure you know everything there is to know about it.

What is third party liability insurance?

This is a four-wheeler insurance coverage that protects the car owner from third-party claims for damage to their property or injury or harm to a third party.

The claim is made against the car owner by a third party, and the insurance policy protects the car owner from these claims. Third-party liability car coverage claims are divided into two categories:

  • Damage to property
  • Accidental personal injury

When it comes to property damage, the limit for four-wheeler insurance is Rs. 7.5 lakhs. If the damage is more, the insured will have to pay the difference out of pocket.

Personal accident damage, on the other hand, covers any harm or injury to a third party, including medical expenses.

The insurance regulator sets the third-party liability premium rates, which are essentially the same for all insurance companies. These expenses, however, vary depending on the automobile model and engine capacity. Obtaining this form of car insurance via the internet is really convenient.

New rules for third party liability:

There are new restrictions regarding third-party liability insurance, according to the Supreme Court. Insurance companies must now provide long-term third-party liability plans for four-wheelers. For automobile owners, this entails a three-year upfront expenditure in car insurance coverage. It is, however, feasible to get separate personal accident and own damage insurance.

The upfront policy prices increase with this long-term insurance coverage, but there is no need to renew the policy for another three years.

How are claims made under this insurance policy?

If you cause damage to a third party’s property or cause injury to a third party as a result of an accident, the claims process might be lengthy. The first step is to contact the insurance company so that a customer service representative can assist you with the next stages.

It will also be important to file a police report detailing the circumstances surrounding the collision. You should photograph the damage because the insurance company will require this information.


If a third party wants to sue you for damages, they must file a claim with the Motor Claims Accident Tribunal through a motor claims lawyer. The court will examine the facts of the case before making a decision on the amount of damages to be awarded. The typical time it takes to receive an order like this is two to three years, and it can take considerably longer.

If you wish to make a claim against someone’s third-party responsibility insurance, you must first submit a FIR and then go to the Motor Claims Accident Tribunal. Another alternative is to file a claim for car damage under your own insurance policy. Policy for a four-wheeler.


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