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Car Insurance
93% ACKO users save at least ₹1,200 on car insurance
Car insurance starting at ₹2,072*
Car insurance starting at ₹2,072*
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Looking to insure your new bike?
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Third-party car insurance refers to the mandatory car insurance policy you need to purchase to drive your car legally on Indian public roads. Third-party car insurance is also known as Act-only or Liability car insurance. Note that non-compliance can lead to penalties as per The Motor Vehicles Act, 1988.
Third-party car insurance works by insuring the policyholder against liabilities arising due to injury sustained by a third party or damage to a third party’s property by the insured car. In such a scenario, the third party will most likely demand compensation to treat injuries or repair damages from the car’s owner.
In the case of third-party liabilities, a case will be filed and the owner’s car insurance company reimburses the third party. This is a simplistic explanation of how Third-party insurance works. The situation gets complex when you happen to crash your car into another vehicle. In almost all cases, there is a need for a First Information Report (FIR) to be filed with the police. Third-party cases are settled as per the Motor Accident Claims Tribunal.
There are three parties involved in third-party car insurance.
The first party i.e. the policyholder is liable to compensate the third party for the injuries or damages to their property.
The second party is the policyholder's insurance company, which compensates the third party as per the terms and conditions of the insurance policy.
Third party can be any other person, for example, a pedestrian who has sustained injuries or damages to their property by the first party's insured vehicle.
Third party can be any other person, for example, a pedestrian who has sustained injuries or damages to their property by the first party's insured vehicle.
Here’s a list of top features of a Third party car insurance policy.
A third-party liability policy is available at a low price. It is available at a nominal price as compared to the Comprehensive car insurance policy.
The process to purchase a third-party liability is simple. As it is a standard policy, there is not much to choose from. You simply have to select your car’s model and purchase the policy.
A third-party liability policy will cover you against personal injuries to a third party and property damages to a third party up to Rs. 7.5 lakh.
PA cover is mandatory by law. Hence, it is recommended to buy this cover along with a Third-party Liability plan. It offers insurance coverage up to Rs. 15 lakh for the owner/driver in case of death/permanent disability while driving.
Unlike a Comprehensive policy, insurance companies do not decide the premium for a Third-party policy. The premium is decided by the Insurance Regulatory and Development Authority of India (IRDAI) based on the cubic capacity of the car’s engine. The premium rates set by IRDAI are subject to changes. Here’s a table showcasing third-party car insurance premium rates for FY2019-20.
| Key features | ACKO ADVANTAGES |
|---|---|
| Premium | Car insurance plans starting at Rs. 2,072 |
| Add-ons | 8 add-ons available to enhance your insurance plan |
| Own Damage policy | Available under Comprehensive Cover |
| No Claim Bonus | Up to 50% Discount |
| Personal Accident Cover | Available. Cover up to Rs. 15 lacs for permanent disability/death while riding |
| Claim Settlement Ratio (CSR) | 95.45% for FY21-22 |
| Claims settlement process | Quick, paperless, cashless, and stress-free. Instant claim settlements for minor damages (Within 2 hours) |
| Buying/renewal process | Instant, 100% digitally-driven and super-easy |
Claim settlement in a third party insurance policy is a complex process. It is not as simple as it is in a Comprehensive policy. You cannot simply call your insurance company to take care of the matter. There’s a legal process involved. The steps to raise a claim might be different on a claim-to-claim basis. Here’s a broad overview of the steps that are involved in settling a Third-party claim.
Informing the insurance company (ACKO in this case) and filing the First Information Report (FIR) with the police. Normally, the third party files the FIR.
Registration and hearing of the case in the Motor Accident Claims Tribunal. The Tribunal will go through all the collected evidence and the testimonials.
Result of the case in the Motor Vehicle Tribunal. The hearing and the declaration of the result can take time. This will be followed by the settlement of the claim amount by ACKO.
Unlike a Comprehensive plan, the rates for a Third-party car insurance policy do not change from one insurer to another. The rates are determined by the IRDAI and remain standard for all insurers. The IRDAI might decide to vary it on an annual basis, but all insurers have to abide by the rate stated by the IRDAI. Thus, there is no way to get the cheapest Third party insurance policy as all insurers offer these policies in exchange of the same premium amount.
Whether you own a private vehicle for commuting or a commercial vehicle for business purposes, you need to purchase a Third-party policy. The basics of a Third party car insurance policy remain the same for a private and a commercial vehicle. However, there might be slight variations concerning the cover, premium, and terms and conditions. The online purchase process of a commercial policy is also different from the process for a private one.
The process to buy third party insurance online for cars is simple, quick and hassle-free. The entire purchase journey is straightforward. Here are the reasons why you should buy third party insurance online for four-wheelers.
Buying third party car insurance online is hassle-free and easy. At ACKO, you need to provide a few details of your car, such as registration number, model, year of manufacture, and previous policy (if available) on our official website or mobile app to insure your vehicle within a few minutes.
You can access our official website and mobile app 24/7. Whether you are at your home, work or even travelling, access our online platform any time of the day to buy, renew or raise claims.
There is no paperwork involved to buy third-party car insurance online. Enter a few details of your car and insure it with the Third-party Liability Plan instantly.
The Third-party Insurance Plan is different as compared to the Comprehensive Insurance Plan
The Comprehensive Insurance Plan for cars offers wide-ranging benefits. Apart from coverage for third-party liabilities, it also covers damages to the insured vehicle. Damages or losses arising from accidents, natural and man-made disasters, theft, fire and explosion are covered under this plan.
Since the coverage is limited in Third-party Car Insurance Plan, the premium is lower as compared to the Comprehensive Insurance Plan.
Here are a few crucial points that you need to consider while making a third-party car insurance claim.
You (third-party) should file an FIR at the local police station and inform ACKO about the incident immediately. If you do not follow these actions, your third party insurance claim may be rejected.
Ensure there is enough evidence about the accident or incident to prove the other party’s mistake.
While there is no capped limit for compensation towards injuries or death, the maximum amount set for damages to third party property is limited up to Rs. 7.5 lakhs.