Motor insurance

What is Liability Only Insurance Cover in Motor Insurance

According to the Insurance Regulatory and Development Authority of India (IRDAI), “a long-term liability insurance cover for third party is compulsory to buy for every new vehicle’s owner at time of…

According to the Insurance Regulatory and Development Authority of India (IRDAI), “a long-term liability insurance cover for third party is compulsory to buy for every new vehicle’s owner at time of purchase of new vehicle”. The Indian insurance regulatory has made it a statutory requirement to cover the individual or third party who has been suffered in an accident for which you were at fault.

Understand What is Liability only Insurance Cover in Motor Insurance

To understand what liability only insurance cover in motor insurance is, let us consider a real-life situation first. For example, today morning you have smashed a car in the middle of the road when you are coming to the office. You and another party both have called up insurance companies as you both failed to determine who is at fault. In that situation, your insurer will work together with the other party insurer to find out who is in a fault state. If you are at fault, your insurance provider will provide the cost for other party damaged car and injuries as per your covered limit. Similarly, if the opposite party is in the fault state, his/her insurer will cover your damage. In short, a liability only insurance policy is an insurance policy in which the third party and his/her property or vehicle is covered but the insurer or his vehicle is not covered. A liability-only insurance cover in motor insurance helps cover the damages of other party’s property and injuries happen in an accident.

Who Actually Needs a Liability only Insurance Cover in Motor Insurance

Liability insurance is very important for auto coverage and we all need to buy it. The premium amount and coverage vary from policy to policy and state to state though. Bodily Injury (BI) liability and Property Damage (PD) liability are two key types of coverage that are mandatory in all states. Therefore, depending upon your needs and the choice of premium, you can choose a plan that will provide you with the maximum benefits with a wide coverage.

Features of Liability only insurance Cover in Motor Insurance

Third Party Liability: Insurance provider would be obliged to pay for any legal liability that arises out of injury, death, permanent disability or damage to property of a third party because of an accident involving the insured vehicle.

Covered Vehicles: This plan is applicable to private vehicles, commercial vehicles, and two-wheelers. It can also be availed by goods carrying vehicles viz private and public carriers and passenger carrying vehicles too.

Personal Accident Cover: Insurance companies provide a personal accident cover worth up to one lakh for two-wheelers and up to two lakhs for private and commercial vehicles in situations of accidents. Total disability or death of the driver or the owner is also covered in the plan.

Cover of Extent: Most of the insurance companies offer up to 7.50 lakhs to cover third party property damage. The policyholder can also restrict the amount of coverage provided to the third party for damage. This can aid the policyholder to reduce the “Liability only” premium.

Key Coverage under a Liability Insurance Plan

This auto insurance plan provides coverage for different types of losses to a third party that is affected in an accident. The policy covers;

  • The case of death and bodily injury to a third party
  • The case of death of the insured vehicle owner or driver
  • Disability of the insured vehicle driver or owner who is on the wheels at the time of an accident
  • Also, cover personal accident cover

What is not Included in Liability only Insurance Cover in Motor Insurance:

There are a number of situations which are excluded from liability only cover. It does not apply to the insurer’s own injuries if he is at fault. Death and injuries of an employed individual with the insurer is not liable for reimbursement under the policy. Liabilities that are the result of theft and the use of any nuclear material or any other weapon are also not a part of liability only cover.

So, do not waste your time. Checkout online the top insurance companies’ liabilities only cover plans. There are so many insurance providers which are known for quick and easy claim settlement, check online and choose your insurer wisely.

Last updated on