There is no doubt that buying a vehicle comes with an undisclosed rule of purchasing a vehicle insurance policy as well. Most of us end up buying it only because it is mandatory under the Motor Vehicles Act 1988 but we need to understand that these insurance policies are for our benefit. In India, there are different kinds of motor insurance policies, and it is important for us to know about each of those policies in depth so that we can choose the right one for ourselves.
One of those policies is the Third Party Insurance Policy which is also known as liability coverage. It meets the minimum legal requirements of motor insurance and provides cover for all your damages if you harm a third party. In this article, we would be discussing the pros and cons of having only a third party insurance.
Pros of Third Party Insurance
The cost of third party insurance is one of its main advantages. In the case of an accident, where you have caused damage to a third party, you will be on the safer side and save up on some money with the help of a third party insurance policy. Rather than you being held liable for the damages, the entire amount (property damage up to 7.5 Lakh) would be settled by the insurance provider. In case you don’t have a third party insurance, you can be sued, and you would have to shell out the legal expenses from your own pockets.
Since you are meeting the bare minimum legal requirement for insurance, you don’t have to be worried about getting pulled over for lack of an insurance policy.
Unlike other insurance policies, buying or renewing third party insurance policies is not much easier as not every insurer offer this online, but you can search insurers who offer this online and purchase or renew it online. It not only saves time, but you can purchase at your convenience.
Cons of Third Party Insurance
Just like pros, there are certain cons as well related to third party insurance. One of them is the fact that in the event of an accident, this insurance would not protect you from the damages occurred to your vehicle. If you are responsible for the accident, then you are responsible for paying for all the repairs as well.
The next disadvantage is that in the case of theft of your vehicle or damage due to fire, your third party policy would not be of any help. The only way you would be able to make any claims would be by upgrading your policy to third party fire and theft policy.
As mentioned earlier, having a third party insurance policy can save you from a lot of legal as well as financial hassles. Third party insurance policy differs from one company to company, so you would have to compare the rates and benefits offered by the various companies before making your final choice. We hope this list of pros and cons of third party insurance policy helps you in getting a clearer picture and aids you in making the right choice.