When you drive your car, there is always a risk of an accident or a mishap. If the accident takes place due to your negligence and causes damage to third-party property or injures a third person, then you are liable to pay compensation for the same.
In India, it is mandatory for all car owners to have a 3rd party car insurance policy that allows car owners to pay for the damages caused by them during such accidents or mishaps. These policies cover a range of losses caused to third parties with certain limits, as described below.
When you buy a car, it is important to consider buying car insurance online too. While it is mandatory to have a third-party liability cover, you can also opt for a comprehensive cover that offers protection to your car as well as offers third-party liability insurance. You can compare car insurance policies and buy car insurance based on your budget and requirements.
Let us understand the third-party insurance claim limit and coverage in detail.
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Details of the Coverage and Limits of Compensation Under Third-party Car Insurance
To understand the coverage and limits of third-party car insurance, let’s look at an example:
Mr A is driving a car with a third-party liability insurance policy. He meets with an accident with Mr Y’s car and causes damage to the car and physical injury to Mr Y. Here is a list of third-party insurance claims that Mr Y can file.
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Third-Party Property Damage
Since Mr A’s car caused damage to Mr Y’s car, the insurance company will pay compensation to Mr Y for the costs associated with repairing the car. However, to file the claim, Mr Y needs to file an FIR with the police and lodge a case with the Motor Accident Claims Tribunal (MACT).
In addition, he needs to submit original bills from an accepted garage, surveyor’s report, and inspection report to assess the loss. The maximum third-party insurance claim limit for property damage is ₹7.5 lakhs. However, the court holds the right to decide the extent of the loss. If it exceeds this amount, then Mr A needs to bear the additional cost.
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Injury To The Third Party
Since Mr Y got injured in the accident, he can claim compensation for the treatment and associated medical expenses.
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Disability Of The Third Party
If Mr Y suffers from a partial disability, then the insurance company of Mr A will cover the expenses of medical treatment and hospitalisation incurred by Mr Y.
However, if Mr Y suffers from a permanent liability, then the insurance company of Mr A will offer compensation to Mr Y apart from covering the medical and hospitalisation costs.
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Death Of The Third Party
If Mr Y dies as a result of the accident, then his legal heir can take Mr A to MACT. Also, Mr A will be liable to pay compensation to the legal heir of Mr Y. While there is no defined limit for this compensation, the court will decide the compensation amount based on the details of the case.
It is important to note that third-party insurance claims in the MACT can take months before a verdict is reached. The car owner is expected to attend the hearings with a lawyer to help it decide the cause of the accident. As a car owner, before you buy a third-party four-wheeler insurance policy, make sure that you are aware of the coverage and limits of the policy so that you are not in for a surprise later.
Summing Up
While a third-party liability insurance policy can cover the costs associated with damages to a third party, they do not cover the damages to you or your car. Hence, if you meet with an accident, then you will have to bear the costs of repairing your car and/or medical treatment if you get injured in the accident. If you opt for a comprehensive four-wheeler insurance policy, then you can get complete coverage against losses to your car and third parties. Make sure that you assess your requirements and choose the right policy. Good Luck!
