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Comprehensive insurance vs third party insurance

Understand the difference between comprehensive insurance and third-party motor insurance in a nutshell.

The difference can be distinguished by the coverage provided. The prime difference is that third-party vehicle insurance provides you financial coverage against any damage or loss caused to a third-party. whereas, comprehensive insurance not only covers third-party liabilities but also offers coverage for the owner’s loss or damages.

Let us understand both policy types in detail to give you a better understanding

What is a comprehensive motor insurance policy?

A comprehensive motor insurance policy provides complete coverage of the owner, his vehicle, and even the third-party involved.

Benefits of a comprehensive motor insurance policy

Protects your vehicle

It protects against damages caused to your vehicle due to:

  • Accident
  • Fire
  • Earthquake
  • Floods
  • Theft/burglary
  • Windshield wreckage
  • Damage caused by an animal
  • Damage caused by fallen objects
  • Damage against storms, cyclones or , windstorm

Covers third-party Vehicles

This policy also covers third-party liabilities. Bodily harm or injuries caused to the third party are covered.

Value for money

It is a value for money policy for its extensive coverage.

Customization

in a comprehensive policy you can customize your car insurance policy according to your needs and requirements by opting for various add-on covers.

Personal accident cover

It comes with an inbuilt personal accident cover.

Exclusions

Here are few points that are excluded in a comprehensive car insurance policy

Driving without a license

The policyholder will get their claim rejected if they were driving without a license during the event of a mishap.

Drink and drive

Any loss or damages claimed by the policyholder under the influence of alcohol or intoxicants will be dismissed.

Deliberate negligence

Any claims found to be made by deliberately damaging the car will be rejected.

Valid license

Any claims made while carrying a learner’s license will not be accepted.

Nuclear war

Any damages or loss caused due to a nuclear warhead or mutiny will not be covered.

Mechanical & electrical damage

Any damage to the mechanical and electrical system of the vehicle will not be covered.

Third-party car insurance policy

What is Third-party liability vehicle insurance?

A third-party liability vehicle insurance is the most basic and mandatory form of car insurance. It is mandated to have at least a third-party vehicle insurance policy as per the Motor Vehicles Act 1988.
As the name suggests, this policy provides financial coverage against third-party liabilities only.

Benefits of a third-party liability car insurance policy

Covers third-party liabilities

As mentioned earlier, it protects the interests of the third-party that is involved in the accident. Any court-ordered compensation will be paid to the third-party by the insurance company.

Covers death or injury

Provides financial compensation to the third-party in case of death or disability.

It is mandatory

As per The Motor Vehicles Act 1988, it is mandatory to have a third liability car insurance policy. It is illegal to drive on Indian roads without it.


Exclusions under third-party liability motor insurance

Own damages

Damages caused to your own vehicle will not be covered under third-party motor insurance.

Drinking and driving

Any claims made under the influence of alcohol or intoxicants will be rejected

Driving without a license

Any claims made while driving without a driving license will not be accepted.

Which policy should you opt for?

It is always advisable to opt for a comprehensive motor insurance policy as it provides complete 360- degree protection. Although not necessary, opting for a comprehensive motor insurance can save you a lot of hassle in the future.

Comprehensive insurance vs third party insurance

 

Comprehensive Insurance

Third -party insurance

About

This policy offers financial coverage in case of any damages or loss caused to the car, owner or the third-party.

Offers financial coverage against any damage caused to third -party only.

What is covered?

Covers accidental damages caused to own vehicle as well as third party vehicle.

 

Covers damages caused due natural calamities like earthquake, floods, riots, etc.

 

Covers against man made calamities like fire, strikes, etc.

 

 

Covers against accidental damages caused to the third party or their vehicle.

 

 

Premium

Premium cost shall depend on various elements such as car make, car type, etc.

 

Premium cost will be higher compared to a third-party insurance policy.

 

 Premium cost will be cheaper compared to a third-party insurance policy. This is due to the limited protection that this policy provides.

Optional add on cover

You could opt for various add-on covers/riders based on your needs.

Some notable add-on covers:

Zero depreciation cover

Engine replacement cover

Roadside assistance cover.

Not available

Is it mandatory?

It is upon the discretion of the policyholder’s needs and requirements whether   to go for  a comprehensive insurance policy.

This policy is mandatory under The Motors Vehicles Act, 1988.

Are you looking for a new motor insurance policy or a policy renewal? Reach out to us and let us assist you.

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