Is third-party insurance compulsory for a vehicle? The answer is yes. According to section 146 of the Motor Vehicles Act 1988, it is mandatory to have third-party (TP) insurance. This insurance protects you from the legal, accidental, or property damage caused to a third party by your vehicle.
If you own a vehicle then you are obliged to have TP insurance. The car owners are obliged to a three years TP insurance and two-wheeler owners are required to have a five years policy. Upon finding a person driving a vehicle without TP insurance is charged with a penalty or imprisonment.
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What is third-party insurance?
Third-party insurance acts as a shield when your vehicle causes any accidental or property damage to a third party. To save you from all the legal and financial troubles the insurance company compensates that person on your behalf.
A driver needs to carry TP insurance to ride the vehicle in a public place. It is mandatory to have TP insurance under the Motor Vehicles Act 1988, section 146. A fine of up to Rs 5000 or imprisonment of 3 months or both is the penalties driving a vehicle without insurance.
Why is third-party insurance compulsory for a vehicle?
Third-party insurance, also called third-party liability is your helping hand when a third-party person, vehicle, or property is harmed by your vehicle. The insurance company pays the victim on your behalf up to Rs 7.5 lakh. Beyond Rs 7.5 lakh, you are accountable for the expense.
The situations where you can claim for the damages are:
- Damages to other person’s vehicle or property – If you have accidentally trashed someone’s vehicle or property, then you can claim for insurance.
- Bodily injury or death – Physical injury or death of the victim are also claimable under the insurance. All the expense is borne by the insurance company.
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What cannot be claimed under third-party insurance?
If there are some exceptions then why is third-party insurance compulsory for a vehicle? This is a common query to arise. However, the claim can be made for the events that are accidental/ or unintentional and not for the ones that are preventable or deliberate. The unclaimable situations are:
- Damages to your vehicle – Any damages caused to your vehicle are not covered by TP insurance.
- Drunk driving or without a license – These events are your responsibility as you are the one guilty here. Also, driving without a license is your fault.
- A learner with a license holder – If you are a learner and driving without a proper license holder, then you can not claim TP insurance. It does not matter if you have a learner’s license.
How to claim third-party insurance?
There are different situations where TP insurance is important and you should know how to claim it. The most common ones are:
- When you damage the other person’s vehicle or property
In this situation, you might have crashed somebody’s property or left a dent in their vehicle. It can be settled with a mutually agreeable amount out-of-the-court or by lodging an FIR against you in the local police station. In the second option, after the FIR is filed, obtain the charge sheet and share the copy of your insurance. To analyse and settle these cases, Motor Accident Claims Tribunal (MACT) is formed. They will decide the guilty person and the compensation amount.
- When someone damages your vehicle
Herein, you can claim when someone has damaged your property or is bodily injured. In this too, an FIR is filed and you will receive a charge sheet. Collect the evidence or witnesses in your favour. Get the details of the TP insurance of that person’s vehicle to present them to Motor Accident Claims Tribunal. They will listen to both parties involved and conclude.
If you have comprehensive motor insurance, then you choose the subrogation option. Here, the insurance company will pay you the damaged expense and sue the culprit to recover the same amount.
What are the documents required to claim Third Party insurance?
The documents necessary to claim the insurance are:
- Filed the claim form
- Copy of FIR
- Copy of driving license and RC of vehicle
- Copy of insurance policy
- Medical bills and reports, in case of physical injury
In conclusion, the answer to ‘is third-party insurance compulsory for a vehicle?’ is a mandatory yes. No matter how careful you drive but a small distraction and you are liable for compensation. Think of TP insurance as your friend who will cover your liability towards the damaged third party. Hurry and buy Third Party insurance soon.