Insurance
•01 min read
Welcome to our brand-new series, A-Zs of Insurance. In this series, we will venture into the world of insurance to breakdown insurance jargon for you, so you’re empowered to make informed decisions about your financial security.
Accidents can happen anywhere, at any time. It’s important to practice safe driving skills and make sure you have enough financial backup if such an unfortunate incident happens, in the form of motor insurance for your vehicle.
One type of insurance you can get for your car or bike is third-party motor insurance. Let’s see what this means.
The policy covers:
Third-party bodily injury or death
If an accident, caused by your vehicle, leads to the injury or death of another person, your third-party policy will take care of the associated costs. The exact quantum of compensation will be decided by the court.
Third-party property damage
If your vehicle causes damage to another person’s property, like their vehicle, street stall, home, etc., your third-party policy will cover the compensation costs.
Yes, third-party motor insurance is a legally mandatory requirement if you are a vehicle owner and want to drive it on the road. If you don’t possess a valid third-party policy, you will be liable to pay a fee, as laid down by the Motor Vehicles Act.
Third-party motor insurance, as the name suggests, takes care of any loss or damage caused by your vehicle to a third-party vehicle, property, or body. So, if you happen to injure another person or cause damage to their vehicle or property while driving, your third-party policy will cover the costs.
For example, Aryan accidentally bumped his car into Rehan’s bike, damaging the taillights and causing Rehan to fall. Aryan owned a third-party motor insurance policy, which covered the costs of repairing the taillights along with Rehan’s hospital bill.
