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Is Third-party Car Insurance compulsory?

While all car insurances are not compulsory in India, third-party car insurance is mandatory according to the Motor Vehicles Act of 1988.

Whether you are going for a long or short trip, ensuring safety at all times is essential. Getting a car insurance policy is the best way to ensure that your car road trips are always secured. With an active car insurance policy, you will get financial assistance if the insured car gets damaged, lost, or stolen under unfortunate circumstances.

While all the car insurance types are not compulsory in India, there is one that you must have. Third-party car insurance is mandatory according to the Motor Vehicles Act of 1988. Continue reading to understand all about third-party car insurance.

Why is Third-party Car Insurance mandatory in India?

The importance of third-party car insurance extends beyond just being a legal mandate. Let us understand the same with an example where you unintentionally damage a scooter on the road while driving a car. In such a case, you will be held liable for the damages incurred on the scooter and may suffer substantial financial loss.

But, with third-party car insurance, you can easily compensate for the losses as the insurer will be responsible for paying against the total damages incurred. So, get third party insurance for your car and ensure protection against third-party liabilities.

Inclusions and exclusions of Third-party Car Insurance

Inclusions: Third-party insurance provides coverage only if a third party is damaged or injured due to the insured car. This policy also covers the financial loss if a third party meets an unfortunate demise due to your vehicle. Thus, depending on the policy terms and conditions, you will get financial assistance to compensate for third-party losses. 

Exclusions: The following are not covered under this policy:

  • Any damage to the car during the accident 

  • If the policyholder suffers a permanent or partial disability

  • If a third party gets injured and the policyholder is found to be driving under the influence of alcohol or drugs

  • If the driver does not have a valid driving license and other vehicle-related documents

  • If the driver is riding outside an area that is not prescribed in the policy 

  • If the driver is found involved in rash driving or overspeeding

Third-party Car Insurance price

The premium rates of third-party car insurance in India are as follows:

It is important to note that, unlike a Comprehensive and Standalone Own-damage car insurance policy, the premium rate of a third-party policy does not change from one insurer to another. In this case, the Insurance Regulatory and Development Authority of India (IRDAI) specifies the premium rate. Moreover, only the vehicle's engine capacity will affect the third-party car insurance premium rates and no other factors.

How to buy Third-party Car Insurance with ACKO?

Listed below are the steps in which you can buy a third-party car insurance policy with ACKO:

  • Go to third-party car insurance on the ACKO app or website

  • Enter the car registration number

  • Click on ‘check prices’ and proceed further to provide vehicle details

  • A list of car insurance plans will be displayed on your screen

  • Select third-party car insurance from the available list

  • Make the premium amount, and you will get policy details on your registered email ID

Claim process of ACKO Third-party Car Insurance

The claim settlement process for ACKO third-party car insurance goes as follows:

  • Firstly, inform ACKO about the third-party accident 

  • The Motor Accident Claims Tribunal will decide the financial compensation, so you need to go for the hearing and trial

  • Once the Motor Accident Claims Tribunal sends a decision, the claim amount will be settled by the ACKO team

Summing up

So, now that you know that third-party car insurance is a legal requirement, make sure to buy it as soon as you have got a car or bike.

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