What is the Importance of Third-Party Insurance?

  • Author :
  • TATA AIG Team
  • Published on :
  • 26/04/2021

In India, every vehicle running on the road should compulsorily have motor insurance, especially a third-party insurance cover. Driving a vehicle without a valid insurance cover can lead to a severe penalty under the prevailing laws. Moreover, motor insurance is not only important because it is legally mandatory, but it gives you the security and peace of mind that you have financial assistance in case your vehicle meets an accident or suffers damages of any kind.

Vehicle insurance, especially a third party car insurance, is essential to ensure you are driving without any risk in India. That is the reason third-party insurance was made mandatory by the Motor Vehicles Act. You can buy third-party insurance separately or include it in the comprehensive insurance for your car. However, be careful to check the car insurance online quotes before buying your policy.

What is third-party insurance?

As per the Motor Vehicles Act of 1988, a third-party insurance cover is mandatory for anyone who owns or drives a motor vehicle in India. A third-party insurance cover is a specific policy that protects you against legal or accidental liability, financial loss or damage to property. The cover also protects you in case of a third-party injury or even death of the person because of your vehicle. 

Since third-party insurance is mandatory in India, most companies usually include it in the main car insurance plan. However, if you purchase a standalone third-party insurance plan, you can club it with a comprehensive car insurance policy that offers own-damage cover, along with personal accident cover for the owner-driver. Importance of third-party insurance in India

When driving, there is a real risk of an accident. In fact, in India, more than 5 lakh road accidents happen annually. This is one of the highest in the world. In these accidents, over 1.5 lakh people die, and more than 3 lakh people are severely injured or become disabled due to the accident. In such cases, third-party insurance in India becomes more of a need than a choice. 

Owing to the increased risk, the Motor Vehicles Act, 1988 mandated a third-party insurance plan for all types of vehicles in India. Therefore, by buying third-party insurance for your car, you comply with the legal obligation and can drive on the road without worrying.

Moreover, third-party insurance financially supports you in case of third-party loss, damage to property, injury or death. This gives you peace of mind knowing that in unforeseen circumstances, you have sufficient financial protection against third-party claims. 

Benefits of third-party insurance

Third-party insurance offers the following benefits:

Legal protection and financial assistance: Third-party insurance cover will financially protect you in case of death or disability of the third party and in case of damage to the third-party property or vehicle. This ensures that your legal and financial liability in case of a third-party claim is taken care of. 

Peace of mind: Third-party car insurance policy gives you peace of mind in case of a traumatic or unfortunate event that is financially draining. Hence, instead of worrying about these expenses, you will get immediate relief from stress and assistance in dealing with the incident.

Easily available: Because of their legal mandate, third-party insurance is easily accessible and easy to buy or renew online. You can avail of it at your time and convenience.

Cost-effective and beneficial: A third-party insurance plan comes at highly affordable premiums that easily fit your pocket. 

With a third-party insurance cover, you legally comply with the requirements of the Motor Vehicles Act. However, be careful when selecting your insurance provider. Choose a trusted car insurance company and get a car insurance online quote to invest in a policy that best meets your needs.

If you own a vehicle, you can buy a secure third-party insurance policy from TATA AIG car insurance at affordable premiums. The TATA AIG third-party insurance provides cover against third-party property damage, death or bodily injury to a third party. This policy is available for private cars, two-wheelers and commercial vehicles also. You can easily get a car insurance online quote, buy a new policy or opt for car policy renewal at your ease. Moreover, the claim process is easiest and fastest, offering you end-to-end support. 

As a responsible driver, it is advisable for you to invest in secure comprehensive insurance for a car that covers not only third-party liabilities but also own-damage to the insured vehicle and personal accident cover for the owner-driver, along with a choice of attractive add-ons.


Why is third-party insurance important?

Third-party insurance is important because it is mandated by the law for all vehicles driving on the road to have a third-party insurance policy. Moreover, third-party insurance financially protects you against any third-party damage, loss of property, death or bodily injury caused to the third party. 

Is third-party insurance necessary?

Yes, as per the Motor Vehicles Act of 1988, third-party insurance is mandatory for all vehicles driving in India.

What is third-party insurance?

Third-party insurance is a basic insurance cover that protects you against financial liability in case of third-party loss, damage of property, or any third-party death or bodily injury.

What are the features of third-party insurance?

A third-party insurance policy protects against:

⦁ Any damage or loss of property/vehicle of the third party ⦁ Any bodily injury caused to the third-party ⦁ An accident resulting in the death of the third-party

Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

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