All You Need to Know About Third Party Car Insurance Claim Limits

Driving a car comes with a lot of responsibility. And this is exactly why, as a car owner, it’s crucial for you to have an insurance plan that offers financial backup in case of damage or accident. In India, there are three types of car insurance policy. These include comprehensive, stand-alone own damage insurance and third-party car insurance policy. The most basic and mandatory policy among these is third-party car insurance.

Let’s take a look at all the important details that every car owner should know about third-party car insurance claims.

What is Third-Party Car Insurance?

In India, having third-party car insurance is legally mandatory under the Motor Vehicles Act of 1988. It safeguards car owners from various third-party liabilities that can arise while driving an insured car.

This includes covering the costs involved in a third-party claim due to a car accident. It offers protection against third-party bodily injuries, personal property or vehicle. Claiming third-party insurance proves helpful for both the parties involved in the accident.

Similarly, for example, with third-party insurance, if someone hits you, it covers the damages to your vehicle and any medical expenses, ensuring that you are not financially burdened by the accident.

Moreover, the IRDAI has set a standard third-party insurance price or premium which can vary based on the cubic capacity of your car.

Types of Compensation That You Can Expect Under Various Circumstances

Here are some of the conditions under which you can file for third-party compensation:

Compensation for Injuries Caused Due to an Accident

In case of minor wounds, car accident insurance claims for third party help you cover the treatment and medical expenses of the victim.

Compensation for Partial Impairment Due to an Accident

If the accident causes partial disability, the compensation amount would also increase. This means that you won’t be responsible for covering the expenses, as the insurer will bear the hospitalisation costs in case the victim files liability charges against you.

Compensation for Permanent Impairment Due to an Accident

Accidents may also lead to permanent disability of an organ, like loss of vision. In such cases, the third-party insurance will cover the expenses of the victim during the treatment.

Compensation for Demise Due to an Accident

In case of an unfortunate death of the third-party due to the car accident, you can use the insurance to pay their legal heir.

Compensation for Property Damage Due to an Accident

If you damage a property during an accident, third-party insurance covers the expenses that were incurred in the repair. However, when compared to disability or demise, the compensation for property damage may be less.

As per IRDAI regulations, third-party liability coverage provides unlimited compensation for injuries to third parties. However, for third-party property damage, the coverage is capped at ₹7.5 lakhs to ensure financial protection within this limit for any damage caused by the insured vehicle.

 Wrapping Up

Third-party car insurance is a mandatory requirement for all vehicle owners in India. It provides financial protection against legal liabilities arising from accidents involving third parties. By understanding the third-party car insurance claim limits, you can ensure a smoother and more efficient claims process and avoid out-of-pocket expenses.