Comprehensive And Third Party Insurance : What Is The Difference Between Comprehensive And Third Party Insurance?

Keeping in mind the increasing number of accidents that Indian roads experience in a day, there are some strict rules laid by the Motor Vehicle Act of India. One such rule is to have a valid car insurance policy for your vehicle. Now, there are two types of motor insurance offered by the general insurance companies, one is third-party insurance and the other one is a comprehensive policy.

According to the Indian government, it is mandatory to have at least third-party insurance done for your vehicle in the interest of a third person if he/she gets injured by your vehicle. 

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Third Party Insurance Meaning

The question is “what is third party insurance?”. A third-party insurance policy is a mandatory motor insurance policy for you to have before driving on the Indian roads. In case your vehicle injures a person, causes his death, or damages anyone’s property, you become liable to pay for their expenses. This is wherein third-party insurance comes in and pays the financial liabilities on your behalf.

Benefits of third-party insurance:

1. Allows you to drive on Indian roads legally.
2. Saves you from legal consequences and penalties.
3. Pays the financial liabilities on your behalf if your vehicle has met with an accident and injured someone or damaged their properties.

What is Comprehensive Coverage and what are its benefits?

Let me now explain comprehensive insurance. Comprehensive meaning is overall or complete, so a comprehensive motor insurance policy includes all the benefits of a third-party insurance policy along with extended coverage for the owner’s own damage. This is a comprehensive type of motor insurance policy that comes with several benefits like add-on features and therefore, is preferred by most vehicle owners.

Benefits of a comprehensive insurance plan:

Comprehensive insurance meaning an overall coverage of own damage of the vehicle along with third-party legal liabilities. Here are the benefits of the same:

1. Saves you from legal consequences and covers third-party liabilities on your behalf.
2. Compensates for damages or loss caused to your vehicle due to natural or man-made reasons.
3. You get the option to choose your vehicle’s IDV so that you get the right compensation from your insurer at accurate premiums.
4. This policy allows you to modify your plan at the time of renewal and you can even switch your insurance provider. 
5. The wide coverage offered makes this plan cost-effective.
6. Can also cover the personal and pillion rider’s accidental expenses.

Difference Between Comprehensive And Third Party Insurance:

Comprehensive vs third party insurance – Who should buy what?

After reading about the similarities and differences between comprehensive and third-party insurance you must have understood more about them. However, these points will help you select the right plan if you are still confused; 

• If you own an old vehicle and do not use it frequently then a third-party cover is good enough for you. 
• If you cannot afford higher premiums, this policy can work for you.
• If you are a learner or own a new/ premium vehicle or are a frequent user of your vehicle, then comprehensive coverage can be highly efficient for your pocket. 
• A comprehensive plan though slightly high on premiums offers a wider range of coverage and is recommended by all.

Conclusion

It is important to follow the rules and regulations set by the Motor Authority of India to save yourself from any legal trouble. Understanding your requirements as an owner, estimating the frequency of usage of your vehicle, analyzing your driving skills, and checking the affordability of plans are the steps that should be followed before buying a motor insurance policy. Also thinking about unforeseen consequences and comparing the plans online can help you avail the best motor insurance for your vehicle.

Also Read: Top Benefits of Comprehensive Online Bike Insurance Policy | What is the Difference Between 1st Party and 3rd Party Insurance?