Even though Third-Party Motor Insurance is mandatory for driving vehicles on Indian roads, it does not provide cover for the policyholder’s own car, in case of an accident. This insurance policy, however, is mandatory for all vehicles in India, according to the Motor Vehicles Act 1988.
Third-party insurance, as the name suggests, provides cover for the third party vehicle and the third party in case of an accident. It doesn’t extend the cover for the policyholder himself. However, if a policyholder wants to get insurance cover for oneself, he/she needs to opt for a comprehensive insurance policy. While Third Party Insurance is mandatory in India, a comprehensive insurance policy is not.
A comprehensive insurance policy, unlike third party cover, includes both third-party and own damage cover. Hence, the premium of a comprehensive motor insurance policy is priced higher than a third party insurance cover. This is also one of the reasons why most people in India opt for only a third party motor insurance policy and do not go for a comprehensive insurance cover.
Having said that, there are various things that third party motor insurance do not cover, and usually, policyholders benefit nothing in case of an accident.
Here is what you will be deprived of with a Third Party Motor Insurance cover;
1. Damage of Own Vehicle – In case of an accident, damage to the policyholder’s own vehicle is excluded from the Third Party Motor Insurance Policy.
2. Cover against injuries of the policyholder – Similar to damage of the policyholder’s car, any injuries sustained by the policyholder during an accident are excluded under the Third Party Motor Insurance Policy.
3. Personal Belongings – Third Party Motor Insurance Policy does not cover for the cost of the policyholder’s personal belongings and valuable items like a laptop or mobile phone or jewellery or luggage or cash in case of an accident, which might be present in the policyholder’s car. However, the same can be availed with a comprehensive motor insurance policy, with the 'Loss of Personal Belongings' add-on cover.
4. Other Exclusions – Other exclusions that are not covered under a Third Party Motor Insurance Policy, if the policyholder was driving the vehicle under the influence of alcohol, drugs, etc. Also, if he/she was driving the vehicle without a valid driving licence, or, driving the vehicle outside the prescribed geographical area.
5. If the damage is caused due to an act of war, civil war, mutiny, rebellion, hostilities, damage from nuclear material/ weapons, invasion, foreign enemy action, terror attacks, or radiation will also not be included in the policy.