Third Party Insurance
Owning a vehicle is a dream come true for many individuals in India. Interestingly, people diligently research before purchasing a vehicle, comparing models, features, and prices, the same level of scrutiny often doesn't extend to selecting a motor insurance plan for that vehicle.
While the excitement of acquiring a new car or bike may be noticeable, the importance of securing it with the right insurance coverage cannot be overstated. Just as you carefully consider the specifications and performance of a vehicle to ensure it meets your needs and budget, it's equally vital to assess insurance options thoroughly. After all, an insurance plan works as a shield against potential financial setbacks in the event of accidents or other mishaps.
If you want an insurance plan at minimum cost, you can opt for third party vehicle insurance. You can safeguard your vehicle and enjoy peace of mind on the road ahead by taking the time to research and select the right insurance plan.
We, at RenewBuy, aim to bridge the knowledge gap and shed light on the concept of third party Insurance policies so that you can make informed decisions.
What is Third Party Insurance?
Put simply, third party insurance is a type of insurance policy that covers liabilities arising from damage or injury caused to a third-party by the insured individual or entity. In relation to vehicle insurance, third party insurance covers damages to other vehicles or properties, as well as injuries to other individuals, caused by the insured vehicle.
You should also know the following things about third party insurance:
- Third party motor vehicle insurance does not provide coverage for damages to the insured vehicle itself or injuries sustained by the insured party. Instead, its primary focus is mitigating the financial repercussions of liabilities incurred by the insured party towards third parties.
- Buying third party insurance for all vehicles is mandatory by law.
What are the Third Party Insurance Premium Rates?
The third party insurance premium varies as per the chosen vehicle and the cubic capacity of its engine. Let’s cover different rates for different types of vehicles.
Third Party Car Insurance Premium
The following table covers the third party car insurance premium rates as per the recent IRDA guidelines:
| Car Engine Cubic Capacity (cc) | Third Party Insurance Premium |
|---|---|
| Up to 1000 cc | Rs. 2,094 |
| Between 1000 cc and 1500 cc | Rs. 3,416 |
| Above 1500 cc | Rs. 7,897 |
Third Party Two Wheeler Insurance Premium
| Engine Cubic Capacity (cc) | Third Party Insurance Premium |
|---|---|
| Up to 75 cc | Rs. 538 |
| Between 75 cc and 150 cc | Rs. 714 |
| Between 150 cc and 350 cc | Rs. 1,366 |
| Above 350 cc | Rs. 2,084 |
Third Party Insurance Premium for Good Carrying Commercial Vehicle (Public) - Other Than Three Wheelers
| Gross Vehicle Weight (GVW) | Third Party Insurance Premium |
|---|---|
| Up to 7500 kgs | Rs. 16,049 |
| Between 7500 and 12000 kgs | Rs. 27,186 |
| Between 12000 and 20000 kgs | Rs. 35,313 |
| Between 20000 and 40000 kgs | Rs. 43,950 |
| Above 40000 kgs | Rs. 44, 242 |
Third Party Insurance Premium for Good Carrying Commercial Vehicle (Private) - Other Than Three Wheelers
| Gross Vehicle Weight (GVW) | Third Party Insurance Premium |
|---|---|
| Up to 7500 kgs | Rs. 8,510 |
| Between 7500 and 12000 kgs | Rs. 17,352 |
| Between 12000 and 20000 kgs | Rs. 10,969 |
| Between 20000 and 40000 kgs | Rs. 17,626 |
| Above 40000 kgs | Rs. 25,038 |
Third Party Insurance Premium for Motorized Two Wheelers Used for Carrying Passengers
| Engine Cubic Capacity (cc) | Basic Third Party Insurance Premium |
|---|---|
| Up to 75 cc | Rs. 861 |
| Between 75 cc and 150 cc | Rs. 861 |
| Between 150 cc and 350 cc | Rs. 861 |
| Above 350 cc | Rs. 2,254 |
Third Party Car Insurance (New Private) Premium - Three Year Plan, Single Premium
| Car Engine Cubic Capacity (cc) | Third Party Insurance Premium |
|---|---|
| Up to 1000 cc | Rs. 6,521 |
| Between 1000 cc and 1500 cc | Rs. 10,640 |
| Above 1500 cc | Rs. 24,596 |
Third Party Two Wheeler Insurance Premium for New Vehicle - Five Year Plan, Single Premium
| Engine Cubic Capacity (cc) | Third Party Insurance Premium |
|---|---|
| Up to 75 cc | Rs. 2,901 |
| Between 75 cc and 150 cc | Rs. 3,851 |
| Between 150 cc and 350 cc | Rs. 7,365 |
| Above 350 cc | Rs. 15,117 |
Third Party Electric Car Insurance Premium (Non-Passenger Carrying)
| Vehicle Type | Third Party Insurance Premium |
|---|---|
| Up to 30 KW | Rs. 1,780 |
| Between 30 KW and 65 KW | Rs. 2,904 |
| Above 65 KW | Rs. 6,712 |
Third Party Electric Bike Insurance Premium (Non-Passenger Carrying)
| Vehicle Type | Third Party Insurance Premium |
|---|---|
| Up to 3 KW | Rs. 457 |
| Between 3 KW and 7 KW | Rs. 607 |
| Between 7 KW and 16 KW | Rs. 1,161 |
| Above 16 KW | Rs. 2,383 |
Third Party Insurance Premium for Good Carrying Electric Commercial Vehicle (Public) - Other Than Three Wheelers
| Gross Vehicle Weight (GVW) | Third Party Insurance Premium |
|---|---|
| Up to 7500 kgs | Rs. 13,642 |
| Between 7500 and 12000 kgs | Rs. 23,108 |
| Between 12000 and 20000 kgs | Rs. 30,016 |
| Between 20000 and 40000 kgs | Rs. 37,357 |
| Above 40000 kgs | Rs. 37,606 |
Third Party Insurance Premium for Good Carrying Electric Commercial Vehicle (Private) - Other Than Three Wheelers
| Gross Vehicle Weight (GVW) | Third Party Insurance Premium |
|---|---|
| Up to 7500 kgs | Rs. 7,233 |
| Between 7500 and 12000 kgs | Rs. 14,749 |
| Between 12000 and 20000 kgs | Rs. 9,324 |
| Between 20000 and 40000 kgs | Rs. 14,982 |
| Above 40000 kgs | Rs. 21,282 |
Third Party Electric Car Insurance (New Private) Premium - Three Year Plan, Single Premium
| Vehicle Type | Third Party Insurance Premium |
|---|---|
| Up to 30 KW | Rs. 5,543 |
| Between 30 KW and 65 KW | Rs. 9,044 |
| Exceeding 65 KW | Rs. 20,907 |
Third Party Electric Bike Insurance (New Private) Premium - Five Year Plan, Single Premium
| Vehicle Type | Third Party Insurance Premium |
|---|---|
| Up to 3 KW | Rs. 2,466 |
| Between 3 KW and 7 KW | Rs. 3,273 |
| Between 7 KW and 16 KW | Rs. 6,260 |
| Exceeding 16 KW | Rs. 12,849 |
**The information given in the tables above is taken from the official notification drafted by the Ministry of Road Transport and Highways.
What are the Key Benefits of Third Party Insurance?
Here are some key advantages of third party motor vehicle insurance:
Financial Protection
Third party insurance can provide financial protection against liabilities arising from damage or injury caused to a third party. Whether it's a car accident, property damage, or bodily injury, this insurance covers the expenses incurred in compensating the affected party, including legal costs if a lawsuit ensues.
Legal Compliance
Valid third-party insurance ensures compliance with legal regulations, avoiding penalties, fines, or even legal repercussions. It offers peace of mind, knowing you're adhering to the law while protecting yourself financially.
Cost-efficiency
Compared to comprehensive insurance policies, third party insurance often comes at a lower premium. While it may not provide extensive coverage of comprehensive plans, it offers essential protection at a more affordable cost. For individuals or businesses operating on a tight budget, third party insurance presents a cost-effective solution to mitigate risks.
Risk Mitigation
Life is unpredictable, and accidents can happen at any time. Third party insurance can mitigate the risk of unforeseen events by providing a safety net against potential liabilities. Having this insurance minimizes the financial impact of accidents.
Peace of Mind
Ultimately, third party insurance offers peace of mind, knowing that you're prepared for the unexpected. You can focus on your daily rides with confidence, knowing that you're protected against liabilities.
What are the Common Disadvantages of Third Party Insurance?
While third party insurance offers essential coverage, it comes with its set of limitations, including the following:
Limited Coverage
One of the primary drawbacks of third party vehicle insurance is its limited coverage scope. It only covers liabilities arising from damage or injury to third parties. This means that any damage to your vehicle will not be covered.
Insufficient Protection
In some cases, the coverage provided by third party insurance may be insufficient to fully address the financial consequences of an accident or liability claim. Depending on the severity of the damages or injuries involved, the policy limits may not be adequate to cover all expenses, leaving the policyholder responsible for the cost involved.
Lack of Personalized Coverage
Third party insurance policies typically offer standardized coverage options and do not allow you to tailor the policy to your preferences. This lack of customization means you may end up paying for coverage they don't need or facing gaps in coverage for specific risks relevant to their circumstances.
Premium Variation
The cost of third party motor vehicle insurance premiums can vary depending on the insured party's age, vehicle type, and location. Changes in risk factors or market conditions may lead to increases in premiums, potentially impacting the policyholder's budget.
Comprehensive vs. Third Party Insurance Comparison
| Parameter | Comprehensive Insurance | Third Party Insurance |
|---|---|---|
| Coverage Scope | Offers extensive coverage for own damages and liabilities, including third-party liabilities | Primarily covers liabilities arising from damage or injury to third parties |
| Cost | Typically higher premiums | Lower premiums compared to comprehensive insurance |
| Legal Compliance | Meets legal requirements for vehicle owners in most jurisdictions | Covers legal requirement to comply with regulations |
| Additional Benefits | Often includes supplementary benefits such as roadside assistance, rental car coverage, and more | Fewer additional benefits compared to comprehensive policies |
| Customization | Offers options for tailoring coverage to individual needs and preferences | Standardized coverage options with limited customization |
| Risk Mitigation | Provides comprehensive protection against a wide range of risks | Offers essential protection against third-party liabilities, with potential gaps in coverage |
| Premium Variation | Premiums may vary based on the insured’s age, vehicle type, etc. | Premiums may differ but generally remain lower due to limited coverage scope |
What are the Types of Third Party Insurance?
Here are the two main types of third party vehicle insurance in terms of the vehicle type:
- Third party bike insurance
- Third party car insurance
How to Buy Third Party Insurance?
You can buy third party vehicle insurance from either the insurer’s official website or RenewBuy. Let’s look at the steps involved in each case.
Steps to Buy Third Party Insurance via Insurer's Official Website
- Visit the official website of the insurance company providing motor insurance.
- Look for the vehicle insurance section on the website and select the insurance type - bike or car.
- Browse through the available insurance plans and select the one that best meets your requirements in terms of coverage and affordability.
- Provide all the necessary details accurately in the online application form.
- Once you've filled in the required information, pay the premium using your preferred payment mode.
Steps to Buy Third Party Insurance via RenewBuy
To purchase a third-party insurance policy through RenewBuy, simply navigate to the top of this page and click on the ‘View Plans' button. Our advisors will connect with you to offer competitive premium rates and ensure a convenient policy-buying experience.
Step 1: Initiate the Application
As the first step in claiming third party insurance, the victim or their legal representative needs to initiate the application process against the vehicle owner for compensation.
Step 2: File an FIR
After completing the application, they must file a First Information Report (FIR) with the police. This report should include all relevant details of the incident. The victim must retain a copy of the FIR and maintain original records of expenses incurred.
Step 3: Register with the Motor Accidents Claims Tribunal
Following the successful filing of the FIR, register your case with the Motor Accidents Claims Tribunal. This tribunal specializes in handling cases related to motor accidents.
Step 4: Determine the Compensation
The court of law determines the compensation amount, and the insurer is obligated to pay the full amount. However, the Insurance Regulatory and Development Authority (IRDA) sets limits on coverage, with property damage capped at up to Rs 7.5 lakh.
Important Note: Ensure that the police complaint includes essential information, such as the driver's license number and the names and contact details of witnesses, if available.