In India, third-party insurance is not just a choice but a legal mandate for all vehicle owners. The legal mandate to have a third party insurance for your car and bike is specified under the Motor Vehicles Act of 1988. This insurance policy ensures compensation for damages caused to third parties in accidents involving the insured vehicle. It provides coverage for bodily injury, death, or property damage inflicted on others by the insured vehicle. Owing to the importance of third-party insurance in India, let’s talk about this regulatory mandate in the section below.
Why is Third-party Vehicle Insurance Mandatory?
Let us understand the importance of third-party insurance with an example:
You are driving your car or bike and get caught in an accident where you cause damage to a third party. Now, if you have third-party vehicle insurance, you will get financial compensation for all the damages incurred to the third party. However, if you just have a standalone own-damage cover, there will be no financial assistance to cover third-party liabilities, and if there is damage to the insured vehicle, only that will be covered. This means with this plan you will have to spend from your own pocket to cover the expenses related to third-party damages. Moreover, you will also be liable to pay fines for not having a third-party insurance policy, thus resulting in huge financial loss. Thus, as third-party insurance is crucial, you should get this and can further upgrade it to a Comprehensive policy for added coverage.
How to Buy Third-party Insurance?
As third-party insurance is mandatory for all vehicles in India, many insurers offer this plan. Acko Insurance also offers this type of vehicle insurance plan, so listed below are the steps in which you can buy ACKO third-party insurance:
- Go to car/bike insurance page on ACKO’s website
- Enter the vehicle registration number and proceed further
- Next, provide vehicle details like its make and model, registration year, etc
- Then, enter details such as policy expiry date, mobile number, area pin code, claim history, etc
- You will be able to see a list of plans on your screen
- Select third-party car/bike insurance from the list of plans available
- Proceed further with premium payment, after which you will receive policy details on your registered email id
Is Third-party Insurance Enough?
While third-party insurance is mandatory in India, the question is, will it be enough? Well, as this type of insurance policy only provides coverage for third-party liabilities, it may not always be enough. This type of insurance does not cover damage to the insured vehicle or personal injuries sustained by the policyholder. Thus, assessing the coverage offered and choosing a suitable policy instead of simply buying one for legal requirements becomes important. Ideally, a Comprehensive policy is recommended to ensure complete financial protection for your vehicle.
Inclusions and Exclusions of Third-party Vehicle Insurance
Inclusions
- Damage to third-party property, house, or vehicle
- If a third party gets injured due to the insured vehicle, then the treatment expenses will be covered
Exclusions
- Any damage due to the insured vehicle due to an unforeseen event
- Loss or theft of the vehicle
- Raising a claim when the driver was found driving without a valid driving license or under the influence of intoxicants
- Any accident taking place outside the geographical region mentioned in the policy document
- If the vehicle is being used for commercial purposes or any unauthorised use
- Costs related to injuries sustained by the policyholder or their passengers are not covered
- Damage caused intentionally by the policyholder
Summing Up
In a nutshell, it can be concluded that if you have third-party insurance, you will get coverage only for injuries or damages sustained by a third party. However, as this is a mandatory policy, you must buy this or get a Comprehensive policy that provides coverage for both third-party liabilities and damages to the insured vehicle.
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