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Third Party Insurance vs Comprehensive Insurance Research Team | Posted On Tuesday, May 07,2019, 04:15 PM

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Third Party Insurance vs Comprehensive Insurance



What is Third Party Insurance?

This is nothing but a form of liability insurance, purchased by the insured, for cover/protection against claims of another party called the third party. The second party is the insurer.

Third Party Insurance covers bodily injury and accidental death caused by the policyholder. It also covers property damage caused by the policyholder. You are not covered for own damages suffered by your vehicle in an accident.

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Third Party Insurance vs Comprehensive Insurance

What is Comprehensive Insurance?

As the name suggests, comprehensive insurance is a comprehensive plan. It covers damage to your car/vehicle, third party liability cover, theft of the vehicle and personal accident cover. You can also boost comprehensive cover with additional riders.

Benefits of Third Party Insurance:

A third party motor insurance plan helps you remain stress-free, while dealing with a traumatic situation like an accident.

The third-party insurance policy is extremely cost-effective and beneficial, as premiums are low. If your vehicle injures a person, destroys/damages property or the person passes away in the accident, the insurer compensates the loss.

SEE ALSO: 4 Insurance Plans You Must Have

 Benefits of Comprehensive Insurance:

Listed below are the benefits of comprehensive insurance coverage:

  • The comprehensive car insurance plan provides a large number of benefits and offers a wide range of coverage options.
  • It covers third party liability + own damages.
  • It compensated for the damages caused by theft, natural disasters, man-made perils, damage done by animals or falling objects.
  • Provides compensation for any kind of damage to the insured vehicle.

Third Party Insurance Exclusions:

  • The third-party insurance does not cover injuries you suffer in an accident.
  • It doesn’t cover damages suffered by your car in the accident.
  • Theft of the car is not covered under third-party insurance.

Comprehensive Insurance Exclusions:

  • Depreciation
  • Wear and tear of the vehicle
  • Electrical and mechanical breakdown
  • Damage to tyres or tubes.
  • Damage caused by a person driving the vehicle without a license
  • Damage caused due to drunk driving or due to driving under the influence of drugs
  • Loss/damage caused by war, acts of terrorism or nuclear risk.

Third Party Insurance Coverage:

Third party motor insurance covers you against:

  • Death or bodily injury to a third party
  • The Accidental death of a third party
  • Damage to third party property
  • Permanent total disabilities of a third party in the accident.

The insurer offers compensation to the injured party or pays for the damages suffered by the third party.

Comprehensive Insurance Coverage:

Comprehensive insurance protects against:

  • Theft of the vehicle
  • Vandalism
  • Fire
  • Natural disasters
  • Falling objects
  • Damage caused to the vehicle by animals
  • Damage caused due to civil disturbance.

SEE ALSO: Review Your Insurance Plans With IndianMoney

Third Party Insurance vs Comprehensive Insurance:

There are some major differences between the kind of insurance cover offered by comprehensive insurance and third party insurance plans. A comprehensive insurance cover provides overall coverage whereas a third-party insurance cover provides limited coverage by offering protection only against the claims of a third party. The comparison between the two insurance covers depends on several factors. They are as follows:

  • Value of the car: Opt for comprehensive insurance on your high end car. A high segment car will have costly repairs and paying for them through comprehensive insurance plan is a good idea.
  • Coverage: Third-party insurance covers damages you cause to other vehicles, injuries caused to other people in the accident, as well as damage to third-party property. Third party liability cover is a priority these days, as the cost of repairing damages to your car is high. But, it does not provide you with any cover against damages to your own vehicle. Third Party Motor Insurance is compulsory in India.
  • Expense: A third party insurance cover is cost-effective and the premiums are very affordable. A comprehensive insurance cover is more expensive as it covers you and the vehicle (Own damage Cover). In spite of the slightly higher premiums, it’s advisable to avail a comprehensive insurance cover.

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