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What does third-party motor insurance claim cover?

Damage is unforeseen; we cannot predict what will happen in the next moment. IIFL Insurance in July 2021, accidents are very common these days so taking precautions and beforehand preparations helps to lessen down the burden very much. Taking a Third- party motor insurance, Third- party insurance claim, third- party car insurance, bike insurance for third party helps. However, using two- wheeler and four- wheeler vehicles is never risk-free there is always the possibility of some or other problems to arise.  

Mr. Ramakrishnan met with an accident because of the negligence of Mr. Iyer. He was travelling to his office every day when at one intersection another car came. During the turn from the intersection his car met with an accident with Mr. Iyer’s car. Although Mr. Ramakrishnan had third- party insurance; the damage was quite high, and Mr. Ramakrishnan’s insurance policy cannot cover for all the damage. Therefore, he needs compensation for the damage done to his automobile from Mr. Iyer; therefore, requested a third- party insurance claim from Mr. Iyer. 

 Third- party motor insurance is a statutory requirement for every vehicle as stated in The Motor Vehicle Act, 188. In this the insurer covers for the damage done to the third party’s vehicle, personal property and any physical injury as well. It is the basic legal level of cover provided to the four and two wheelers. 

Why to apply for a third- party Insurance claim?

Although it is mandatory in India to get Third- party Insurance plan for every four- wheeler and two- wheeled vehicle, people still ponder over this and most of the time they failed to reach any conclusion resulting in not taking the appropriate insurance plan at the correct time, but in all this what they fail to understand is that taking a Third- party Insurance Plan will help them financially in case of any unforeseen situation and lessen the burden that will be on them all together. In the case of Mr. Ramakrishnan, though he has comprehensive insurance, it still cannot cover all the damages that his car incurred, therefore, he needs to claim compensation from Mr. Iyer for it. If the policy – holder is involved in any accident and they have the Third- party Insurance plan, the insurer needs to inform the insurance company first before filing for the claim with the insurance company. After this is done, it’s the work of the insurer to check for the damage done to the third- party and find out the estimated cost of damage and settle the matter themselves.

Pro’s of Third- party Insurance Plan.

This claim is known as act- only policy or liability- only policy. The best part of this policy is that it has an affordable premium, it means that the policy holder has to pay an affordable amount for the policy and can get the benefit on any future mishap with the third party. Though this policy does not provide any benefit to the policy holder’s car but it helps in lessen the sudden burden that the policyholder will face in case of any accident. It helps the policy holder legally as well, if any third- party creates issues related to legal liability against the policy holder’s involvement in the accident, the Third- party Insurance plan. 

Why is a Third- Party Insurance Plan important?

It allows the policy holder to comply with the legal obligations, against any problem with the third- party. When Mr.Krishnan had filed for compensation from Mr. Iyer, the third-party insurance must have helped him with the sudden burden of money which he faced because of the accident. This policy is mandatory for every type of vehicle by the Motor Vehicle Act, 1988. People who are driving two- wheelers and four- wheelers might be good and trained drivers but having an insurance policy will give them some peace of mind and they will be more careful that they won’t intentionally hurt someone. Though no one knows what will happen the next minute the policy holder can be assured that if they face any hardship the insurance company will cover for all the damages done to the third-party property, physical injury and other damage done to the third- party.

How many parties are involved in any Insurance Claim?

There are three parties involved in an insurance claim for two- wheeler and four- wheeler. 

  1. First party- The first person involved in an insurance policy is the policy holder or the person who has purchased the policy.
  2. Second party- The second party involved in any Insurance Policy is the insurer or the Insurance Company who will look and analyze the claim made by the first party and settle everything with the third- party.
  3. Third party- The third- party is the party which raises a complaint for the damages caused by the first party to the third party.

How to claim a third- party Insurance policy holder?

Once any accident happens the first thing to be done is file an FIR in the nearby police station and collect the charge sheet from there. The third party can register a complaint in the special semi- quasi court. Getting involved with the court is too time taking and too problematic as well. So choosing the easy way out, the third party can file a complaint on hospital expenses, in case of any injury, permanent total or partial disablement. In case of the demise of the policy holder’s the dependents are eligible to claim compensation.

 In case of any property damage, the inspection officer’s report, original bill and surveyor’s report is needed to estimate the loss. The time for this type of claim of injury or death is only three year. All the paperwork should be done within this time period only. 

The process seems very easy to claim the compensation from the policyholder but the difficult part in all this process is to prove that the accident or damage committed by the policyholder was intentional or because of the other party’s negligence to claim the compensation. Once the third party is successful in proving that it was the negligence of the first party or the policyholder the claim for compensation can be filed. After this, it depends on the Judge to see and give his/her judgment regarding the case in favor or disfavor of the third- party.

Once the court gives the judgment in favor of the third party, the party will get compensated with the amount which the policyholder has got. In case the compensated amount is not enough to cover the amount of damage the third party suffered, you cannot expect the insurance company to pay for the remaining balance. Once the compensated money is claimed, one cannot reclaim any more money for the same damage, it is illegal. In case of Mr, Ramakrishnan, if the court as may be deemed fit found that If Mr. Iyer is at fault, then the court will give judgment in favor of Mr. Ramakrishnan or vice- versa.  

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