As per the Motor Vehicles Act 1988, every four-wheeler owner in India needs to buy a third-party car insurance policy. It covers only third-party liabilities. Car insurance holders get coverage if any loss or damage caused to the property or life of any third party.
What is third-party insurance?
Third-party car insurance is a basic motor insurance policy that every four-wheeler owner must have. It financially covers the policyholder against any losses or damages caused to a third party’s property or if the person suffers physical injury or death. The Motor Vehicles Act of 1988, also mandates buyingthird-party policy at the time of purchasing a new vehicle.
Key features of third-party car insurance
Here’s a quick look at the key features of third-party insurance.
Key features | Description |
Liability coverage | Covers damage or injury caused to a third party. |
Legal protection | Offers legal assistance in case of a legal dispute. |
Property damage coverage | Covers repairing cost of someone else's property. |
Personal accident coverage | Provides financial coverage for injuries or death of the policyholder. |
Third-party injury coverage | Covers medical expenses for injuries sustained by a third party. |
Key benefits of third-party car insurance
Here’s a list of top benefits of a third-party insurance for car.
• Coverage for third-party liabilities
Get financial coverage if any damage, death, or loss caused to a third party due to any mishap or accident.
• Affordable premium
Third-party insurancepolicies are usually available at a low monthly premium. This ensures you have the insurance coverage you need for your vehicle without having to spend a huge amount of money.
• Peace of mind
A third-party car insurance policy ensures peace of mind. As it provides financial coverage against any accident or mishap that might involve a third party.
• Easy online process
You can purchase a third-party insurance policy online with zero paperwork in just a few clicks.
Third-party insurance premium rates
The Insurance Regulatory and Development Authority of India fixes the third-party car insurance premium based on the engine’s cubic capacity (CC). Premiums for these policies are generally lower than the comprehensive car insurance policies.
Following are the premiums set for third-party insurance policies for old, new, and electric cars.
Third-party car insurance premiums for the old cars
Cars with engine CC | Premiums |
Up to 1,000 CC | Rs. 2,094 |
1,000-1,500 CC | Rs. 3,416 |
More than 1,500 CC | Rs. 7,897 |
Single premiums set for three years third-party car insurance policies
Cars with engine CC | Premiums |
Up to 1,000 CC | Rs. 6,521 |
1,000-1,500 CC | Rs. 10,640 |
More than 1,500 CC | Rs. 24,596 |
Single premiums set for three years third-party insurance policies for electric vehicles
Cars with engine CC | Premiums |
Up to 30 KW | Rs. 5,543 |
30–65 KW | Rs. 9,044 |
More than 65 KW | Rs. 24,907 |
Factors that affect third-party car insurance premium
- Vehicle make and model: Luxury or high-performance cars often incur higher premiums.
- Age and experience of the driver: Young or inexperienced drivers may face increased rates.
- Location: Urban areas typically have higher premiums due to higher accident rates.
- Claim history: Previous claims can raise premiums.
- Coverage limits: Higher coverage limits lead to higher premiums.
- Add-ons: Extra coverage options can increase costs.
- Deductible amount: Lower deductibles mean higher premiums.
Understanding these factors helps in making informed decisions when purchasing third-party car insurance.
