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What is Third Party Insurance?

Third party insurance provides protection against financial liabilities arising from injuries, property damage, or even loss of life to others in a road accident from their insured car. It ensures you drive in peace and avoid potential fines and legal complications.

A third party or liability-only policy is the most basic type of motor insurance plan that every vehicle owner must have. It is mandatory under the Motor Vehicles Act for all vehicle owners in India. While it excludes coverage for damages to your own vehicle, 3rd party insurance offers unlimited compensation in the event of a third person's death and property damage claims are limited to Rs. 7.5 Lakh.Read more

Key Features of Third Party Car Insurance

Third-Party Damages

Covers death, disability & property damage

Premium

Nominal as decided by the IRDAI

Mandatory

Yes

Compensation

Unlimited in death up to ₹7.5 Lakh for property damage

PA Cover

Offered for owner/driver

Own Damages

Not Covered

Premium care for your car

Experience Assured Delivery Program

Dedicated claim manager with you from claim start to settlement

Pick-up & drop from accident spot to repair workshop to home

On-ground workshop team for repair & on-time delivery

Dedicated claim manager with you from claim start to settlement

On-ground workshop team for repair & on-time delivery

Why is Third-Party Insurance Important?

A third party car insurance policy saves you from legal and financial liabilities due to an accident resulting in third party property damage and injury or death of the third party. With this policy, you do not have to worry about paying for the medical expenses of injuries suffered by the other party.

The compensation amount under third-party insurance depends on several factors. These include the age, income, occupation of the affected individual, the severity of the injury sustained, and the extent of property damage incurred. If your car is older than 5 years, it is a good idea to get 3rd party car insurance coverage.Read more

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Third-Party Insurance Premium Rates

The third party car insurance price is decided by IRDAI, and is based on the engine or battery capacity. All general insurers now offer long-term 3rd party insurance plans to car owners, which has resulted in a slight impact on the premiums prices. Effective 1st June 2022, the following third-party car insurance premium rates apply:

Regular Car
Electric Car

Engine Capacity

Less than 1000 CC

Third Party Premium

₹2,094

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Engine Capacity

1000 to 1500 CC

Third Party Premium

₹3,416

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Engine Capacity

More than 1500 CC

Third Party Premium

₹7,897

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Battery Capacity

Not Exceeding 30 kWh

Third Party Premium

₹1,780

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Battery Capacity

30 kWh to 65 kWh

Third Party Premium

₹2,904

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Battery Capacity

Exceeding 65 kWh

Third Party Premium

₹6,712

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Key Benefits of Third-Party Insurance

Offers Financial Assistance

Third party insurance provides the policyholder with the financial assistance and helps him/her to pay off the 3rd-party liabilities without exhausting all the savings.

Covers Legal Liabilities

Third party liability insurance legally saves the policyholder in case of an accidental injury, death, or property damage of the third party. Moreover, it also provides compensation to the third person in case of injury or death.

Fulfils Legal Mandate

As per the Motor Vehicles Act of India, 1988, it is legally mandatory for all vehicle owners in India to at least own a third-party insurance cover to be able to use their vehicles on public roads.

Cost-Effective Policy

The coverage offered under third-party liability insurance appears exceptionally cost-effective and rewarding in terms of its cost and premium rate.

Ensures Peace of Mind

Liability only policy helps a vehicle owner to drive in peace since help would be provided by the insured during a road mishap.

Coverages Under Third-party Car Insurance

What is Covered in Policy

Property Damages

In case someone, unfortunately, rams his/her car in a third party person's property, such as the boundary wall or a shop, the third party insurance policy will pay for the loss or damages caused to that person. The motor insurer will cover your damage liability up to the limit of Rs 7.5 lakhRead more

Car Damages

If a car owner accidentally hits a third party's car with his/her own car while driving, the insurance policy will come to the rescue and pay for the damages caused to that third-party's car on the policyholder's behalfRead more

Accidental Bodily Injuries

In case the victim suffers from a disability as a result of the accident, the compensation amount that needs to be paid will be decided by the Motor Accidents Claims Tribunal. But only 50% of the compensation amount is paid by the insurer in case the victim suffers from lost limb or partial blindnessRead more

Accidental Death

If the policyholder causes fatal injuries or disability to a third person in an accident, the insurance company will compensate the victim or their family on the policyholder's behalfRead more

Personal Accident cover

Car insurance companies also offer personal accident cover to the owner-driver of the insured car under third-party car insurance. As part of this cover, the owner-driver of the car is granted compensation in case he/ she ends up suffering from a disability or dies as a result of the car accident. In case of the death of the policyholder, the compensation is paid to the nominee appointed by the car owner. The compulsory personal accident cover for the owner-driver is available for up to Rs. 15 lakhRead more

What is Not Covered in Policy

Own Damages

It does not cover any damages sustained by the insured car, be it accidental damages, fire damages, damages due to natural & manmade calamities, or theftRead more

Drunk Driving

It does not cover any third-party liabilities if the car was being driven under the influence of alcohol or drugsRead more

Invalid Licence or Unauthorised Usage

It does not cover any third-party injuries or damages if the driver of the insured car has an invalid driving license or the car is being used for illegal acts, racing, commercial purposes, etc.Read more

Outside Geographical Limit

If the insured car causes third-party damages or injuries outside the geographical limit as specified in the car insurance policy, it will not be coveredRead more

Contractual Liabilities & Substantial Losses

It does not cover any claims arising out of contractual liability or any accidental loss or damage sustained by the third party, which has accrued from any substantial loss.Read more

Undesignated Driver

If any individual, other than the owner of the car or the designated driver was driving the vehicle, the resultant damages or injuries to the third party are not coveredRead more

Nuclear Perils & War

It does not include any liability caused by a nuclear weapon or radioactive contamination directly or indirectly. Moreover, it does not cover any damage, loss, and/or liability caused to the third party due to invasion war, or any other war-like operationsRead more

Car Third-Party Insurers

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ICICI Lombard Third Party Car Insurance

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Liberty Third Party Car Insurance

Magma Third Party Car Insurance

National Third Party Car Insurance

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Why Third Party Car Insurance is Not Enough?

Here are some reasons why a third party liability policy is not enough for your four-wheeler:

No Option to Avail Add-ons

Add-ons are additional covers that enhance your car insurance coverage. However, with third-party liability insurance, you can not opt for these options. You can only opt for them under a comprehensive car insurance policy.

No Coverage for Damages due to Natural Disasters

Natural disasters, such as floods, earthquakes, tsunamis, etc., are unpredictable. If any of these calamities cause damage or losses to your car, your third-party insurance will not provide coverage.

No Cover for Own Damages (OD)

Third-party liability insurance does not cover damages to your own vehicle. To protect against the costs of your own vehicle's damages, you will need to purchase a comprehensive car insurance policy.

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Third-Party v/s Comprehensive Car Insurance

The key differences between comprehensive and third party insurance is the level of coverage offered. To better understand this, go through the table below:

Third-Party Car Insurance

Comprehensive Car Insurance

Insurance Premium

Less insurance premium

Offers a wide range of coverage but comes with a considerably high premium

Bodily Injury and Death

Covers bodily injury and accidental death caused to the third-party

Covers accidental damages to the insured/insured vehicle and third-party liability as well

Property Damage

Covers property damage caused to the third-party

Covers third-party property damages and own damages to the car due to natural calamities, fire, theft, accidents

Vehicle Value

In case the value of the vehicle is low, it's worth taking this

Beneficial for luxury or expensive cars that offers protection against all damages

Mandatory

This cover is mandatory under motor laws

This cover is not mandatory and can be opted as per the car owner's discretion

How Does Third Party Liability Insurance Work?

To know how third-party liability insurance works, have a look at this car accident scenario:

First Party: The policyholder or the insured individual

Second Party: The insurance provider

Third Party: The individual who claims from the second party for the damages caused by the first party.

In case the insured with a third party car insurance policy is found liable for the injuries or damages to the third party, a claim will be filed against the policyholder. Now, the insurance company will cover the costs for the injured individual, including medical expenses, lost wages, and potential long-term care. This agreement protects both the insured and the third party from significant financial burden.
The person with the third party liability insurance must immediately inform the insurer about the accident. The insurance company will then register the claim against the insured by the third party.Read more

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How to Buy/Renew Third Party Insurance Online?

Here is how you can easily buy/renew third party car insurance online from Policybazaar Insurance Brokers Private Limited:

From the homepage of Policybazaar.com, select the "Car Insurance" tab
Enter your car number on the given form or select "Brand New Car" option
Select details of your four-wheeler such as make, model, variant, fuel type
If it's an old vehicle, the details of your car will be auto-fetched
From the given third party insurance plans, select the one that suits your need
Make final premium payment via the online payment mode
Your third party car insurance policy will be mailed to you as soon as you make the payment.

How to Claim Third Party Insurance?

To raise a claim under third party car insurance, follow this simple process:

Application

The victim or the legal heir of the departed can make an application against the owner of the vehicle for third-party liability compensation.

Lodge an FIR

Once the application is completed, file an FIR with the police, furnishing the required details. He/she must have a copy of the FIR and the original records of the expenses incurred by the victim.

Approach the Motor Accidents Claims Tribunal

After filling the First Information Report (FIR) successfully, the next step is to register the case with Motor Accidents Claims Tribunal.

Get the Cover Amount

The compensation limit is not pre decided . The insurer compensates the full amount decided by the court of law. However, IRDA limits the coverage for property damage to up to Rs 7.5 lakh.

Still Confused? Watch 1 Minute Shorts & Get 100% Clarity

Third-Party Liability Insurance: FAQs

General

Buy/Renew Policy

Policy Coverage & Premium

Claims

Q1. What are the types of car insurance I can avail in India?

Ans: The primary category of car insurance includes two types- third party car insurance, comprehensive car insurance or own-damage car insurance. 3rd party car insurance is mandatory in India, while the others are optional. Apart from these, there are personal accident insurance cover and other add-on covers, such as zero depreciation cover, roadside assistance cover, NCB protector and so on.
Q2. What is the duration of a TP car insurance policy?

Ans: The validity of a third-party insurance plan is usually one year and has to be renewed before the due date. Please note that you will be provided with a fixed grace period for making payment of the premium.
Q3. If I want to sell my car, can I transfer the third party liability auto insurance to the new owner?

Ans: If you sell your vehicle to another individual, you can transfer third party car insurance to the name of the new buyer. The new buyer (transferee) has to submit an application for the transfer of insurance with the insurer within a period of 14 days from the date of transfer of the vehicle in his/her name and after the endorsement premium is paid for the remaining duration of the policy.
Q4. Can I switch from comprehensive car insurance to third party insurance?

Ans: Yes. You can convert your comprehensive car insurance policy into third party insurance at the time of policy renewal. You can compare different third party insurance plans and buy the most suitable plan for your car.
Q5. What if I am caught driving my car without valid third party car insurance?

Ans: If traffic police catch you driving a car without a valid third party car insurance cover, you will be fined Rs 2000 or/ and sent to jail for up to three months. If you are caught for the second time, the fine will increase to Rs 4000 or/ along with a jail term of up to three months.
Q6. What would happen if someone else was driving my car at the time of the accident?

Ans: If someone else is driving your car at the time of the accident and has caused damages or injuries to the third party, your car insurance company will cover the liabilities. But your claim will be rejected if the driver was drunk or driving without a valid licence.

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Disclaimer: The list mentioned is according to the alphabetical order of the insurance companies. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website www.irdai.gov.in

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Third Party Liability Insurance Reviews & Ratings

4.8 / 5 (Based on 324 Reviews)

(Showing Newest 10 reviews)

Subodh

Kolkatta, March 07, 2024

★★★★★

Little discount

I am glad to get my Taigun car insured from Policybazaar. I really liked the way of explation the SBI third party insurance paln feature by Mr. Sachin customer support features. Thanks to an executive who explained each and everything in detail.

Rajesh

Gurugram, February 28, 2024

★★★★★

Online process

I preferred the online process as there are a lot of benefits of the online process like there is no involvement of an agent and sometimes customers can get small discounts on online purchases. I took Magma HDI third party car plan online for my Punto car from Policybazaar for which I did not need to go anywhere else.

Atul

Hyderbad, February 26, 2024

★★★★★

Little discount

After comparing many car plans on different platforms I found the right plan on Policybazaar. I bought my Iffco Tokio third party plan online.

Nilesh

Surat, February 22, 2024

★★★★★

Good service

Mr. Sandeep customer support executive explained everything to me about my third-party car plan and its coverage I really appreciate his hard work. under his guidance, I took kotak car insurance for my Dzire car.

Narender

Delhi, February 17, 2024

★★★★★

Financial support

I have secured Alto my car by taking the United India tihird party plan from Policybazaar. Now it will help me in securing my savings from being wasted on unwanted expenses. Also, the comparison is pretty easy on their website.

Rudar

Nagpur, February 08, 2024

★★★★★

Helpful executive

Customer support executive who was suggesting and helping me find a better plan for my Maruti Wagon R car was very good at his job. The interaction with Policybazaar team was fruitful. I chose the Iffco Tokio limited third party plan under the guidance of an Mr. Raman executive. The services were very smooth.

Rohit

Mumbai, February 05, 2024

★★★★★

Excellent customer service

Policybazaar provides such quick response. All my doubts were cleared by the team regarding Reliance third party car insurance for my 2018 Maruti Suzuki Ciaz. I have got excellent customer service from the beginning to the end of the process.

Sunder

Guna, January 30, 2024

★★★★★

Cooperative team

I compared lot of plan features and price in a while and finally I bought third party insurance policy of royal sundaram car insurance for my Renault Duster 2015 model. Their team was so cooperative and knowledgeable.

Jiten

Gandhi Nagar, January 08, 2024

★★★★★

Hassle free experience

I have bought liberty third party car insurance plan for my Maruti Suzuki Swift Dzire. I was amazed as I got it in just a few clicks and even got soft copy instantly. I am very happy with Policy Bazaar's hassle free experience and great customer service.

Mohan

Delhi, December 19, 2022

★★★★★

Iffco Tokio Car Insurance

Anyone who will buy any kind of plan from Policybazaar will definitely love to come here again as Policybazaar provides excellent service to its customers. When I was buying IFFCO Tokio third party car insurance for my Swift car, Policybazaar took care of my needs.

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What is Third Party Insurance?

Key Features of Third Party Car Insurance

Why is Third-Party Insurance Important?

Third-Party Insurance Premium Rates

Key Benefits of Third-Party Insurance

Coverages Under Third-party Car Insurance

Car Third-Party Insurers

Why Third Party Car Insurance is Not Enough?

Third-Party v/s Comprehensive Car Insurance

How Does Third Party Liability Insurance Work?

How to Buy/Renew Third Party Insurance Online?

How to Claim Third Party Insurance?

Third-Party Liability Insurance: FAQs

Q1. What are the types of car insurance I can avail in India?

Q2. What is the duration of a TP car insurance policy?

Q3. If I want to sell my car, can I transfer the third party liability auto insurance to the new owner?

Q4. Can I switch from comprehensive car insurance to third party insurance?

Q5. What if I am caught driving my car without valid third party car insurance?

Q6. What would happen if someone else was driving my car at the time of the accident?

Q1. Can I skip buying third-party insurance? I drive my vehicle really well.

Q2. Who can purchase a 3rd party insurance?

Q1. Is the service tax applied and what is the amount?

Q2. Can I get zero depreciation cover under my third party car insurance policy?

Q3. As a part of this policy, what is the highest compensation offered?

Q4. Is third party car insurance affordable?

Q1. What documents do I need to submit while raising a third-party motor insurance claim?

Q2. How much time do I get to raise a claim on the third-party liability car insurance policy after an accident?

Q3. If I make a third party claim, will I lose my No Claim Bonus?

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