Third-Party Insurance: Features, Benefits, And Drawbacks

Most bike owners get a third-party liability policy simply to oblige the law. As a result, people obtain the essential coverage to avoid fines without giving much effort to selecting the best-suited bike insurance plan for themselves. 

Knowing the benefits of buying insurance coverage rather than just choosing one to avoid paying fines is important. Also, a third-party cover with insufficient coverage would only help a little in times of need. Questions relating to what is genuinely beneficial and why an individual should continue to have specific insurance coverage are all answered in the following article. 

What is Third Party Insurance?

Third-party Insurance can be referred to as a policy that protects or covers financially on behalf of you when you damage or injure someone while riding your vehicle. Here, a third party is the person injured or whose vehicle/property has been damaged by you. The owner (you) is the first party and the company or firm providing the insurance is the second party. Thus anyone incurring outside that refers to as the third party. 

The insurance company shall take care of the loss suffered by the third party in the case of an accident. The compensation amount is based on several factors, including the intensity of injuries, age, the extent of loss, the ability to earn after calculating death compensation, and so on. 

The Motor Accident Claim Tribunal (MACT) determines the final compensation cost in case of injuries or death. If a third party suffers property damage, compensation might go up to Rs. 1 lakh. Third party bike insurance will assist you in covering the loss you have caused to a third party. Its significance lies in aiding the compensation amount, which can go up to lakhs of rupees. 

Benefits of Third-Party  Insurance Policy

Legal obligations

In case of a legal trial, your third-party insurance policy shall cover your legal bills apart from the compensation as per the terms of the policy. Thus, the first party (owner) need not worry about the expenses incurred because they will be covered by the insurance company subject to the terms and conditions of the policy. 

Disability or death

A reasonable compensation amount is necessary for smooth assistance in establishing financial control of their lives in case of death or handicap for the third party involved. This compensation amount depends on the damage caused and the life expectancy of the injured individual. Your third-party insurance shall cover this for you. 

Medical attention

Major accidents can result in prolonged medical bills. Your insurance company will pay for the necessary treatment needed to recover from the damages done due to the accident. 

Accident insurance for individuals

The Insurance Regulatory and Development Authority of India (IRDAI) mandates you to purchase Personal Accident Coverage with a motor insurance policy (at least one in case you own multiple vehicles). This insurance will reimburse you (or your family) in the event of your death or disability.

Disadvantages of third-party bicycle insurance

Denial of Personal Coverage due to Injury

A third-party policy, as the name implies, exclusively covers third-party obligations. Hence, you must bear all personal costs associated with the insured vehicle. In the case of your personal loss coverage, you shall need an additional bike insurance policy. 

 No place for modifications

IRDA determines the terms and conditions for third-party insurance.  Additional coverage cannot be added to this policy. As a result, you cannot receive services such as roadside assistance or claim additional money with zero Depreciation coverage.

What does third-party bike insurance cover?

Read ahead to get a better idea of what your third-party insurance shall cover:

Third-party medical expenditures – when a third party is harmed in an accident caused by the insured motorcycle, the insurer will aid in covering the medical expenditure. They will also fund costly treatments like emergency surgery. In case of death or injury in an accident or injury, this policy pays a sum determined by the Motor Accident Claim Tribunal.

Property damage – If the bike is covered, third-party bike insurance will cover the damage to the property. Vehicles, house construction, crops, and so forth are examples of property.

Thanks to the digital age, you can quickly get two wheeler insurance online within a few clicks. It covers all the medical and legal expenditures per the terms and conditions of the opted insurance policy. Also, it ensures that the due compensation is paid to the third party without disturbing your account balance. However, you should always get bike insurance after due research on the available insurance providers and policies in the market.

Over time, the procedure for claiming auto insurance has changed. Until recently, filing a claim required filling out paperwork and delivering tangible records, but happily, things have changed. Thanks to digital technology, a more efficient and quick claim registration process for bike insurance are now possible.

There are two possibilities of getting a bike insurance. Either you caused the accident, or you are the victim. In the first scenario, you, as the third party, will file an FIR and claim with the other party’s insurance provider. In the second scenario, you must file a claim with your insurance company (ACKO, in this case). In the first circumstance, you cannot seek reimbursement from ACKO since a third-party insurer will pay out on your behalf.

The user-friendly online platform provided by ACKO makes filing a claim against your insurance quick and hassle-free if you damage your two-wheeler. Thanks to the strong digital infrastructure, you may quickly submit a claim.

You do not need to fill out any long forms or provide physical documentation to support your claim.

You can contact our customer service team to alert us or submit a claim online using our website or mobile application. The three-step claim process using ACKO’s online platform is listed below.

Step 1: First, log in to your account using our website or mobile application.

Step 2: Click “Claim Now” after selecting the insurance card next to your bike.

Step 3: To register your claim, answer a few questions about the damage and attach a photo of the necessary paperwork.

In conclusion

Although safe riding is always encouraged, accidents are unfortunate and often beyond our control. Such incidents can cost the owner lakhs of rupees which you will usually have to cut back from your savings.

A third-party insurance policy is a beneficial option and is always required during unfortunate accidents. 

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