Any vehicle operating on Indian roads must have motor insurance, as the law mandates this. To make this easily achievable, the IRDAI broadly defined two types of motor insurance. The first one is third-party insurance and the second one is comprehensive motor insurance.
What is Third-Party Motor Insurance?
Third-party vehicle insurance pertains to the minimum coverage you would require to drive a vehicle in India. It provides coverage against physical injury or property loss to a third party. In simple words, a third-party motor insurance policy is a pact between your insurance company and you, wherein the former agrees to pay if the latter is found guilty or legally accountable for injuries, death, or property damage that occurred to any third party.
Third-party insurance premium is determined by the Insurance Regulatory and Development Authority of India (IRDAI). It is not decided by the insurer, which means its cost remains the same across all the insurers. However, it varies with the type of motor vehicle you own and its engine capacity.
Latest Third-Party Insurance Premium Rates:
Find below the latest premium rates (with effect from November 2022) pertaining to third-party vehicle insurance in India:
Vehicle Type | Engine Capacity | Rate (Rs.) |
Private Cars | Not more than 1000cc | 2,094 |
More than 1000cc but < 1500cc | 3,416 | |
More than 1500cc | 7,897 | |
Two-Wheelers | Not more than 75cc | 538 |
More than 75cc, but < 150cc | 714 | |
More than 150cc, but <350cc | 1,366 | |
More than 350cc | 2,804 | |
Electric Vehicle | Not more than 30KW | 1,780 |
More than 30KW, but < 65KW | 2,904 | |
More than 65KW | 6,712 | |
New Personal Car - 3 Year Single Premium | Not More than 1000cc | 6,521 |
More than 1000cc, but < 1500cc | 10,640 | |
More than 1500cc | 24,596 | |
New TW - 5 year Single Premium | Not more than 75cc | 2,901 |
More than 75cc, but < 150cc | 3,851 | |
More than 150cc, but <350cc | 7,365 | |
More than 350cc | 15,117 |
*The third-party premium rates are subject to change. Please check the IRDAI website for the latest rates.
What are the Features of a Third-Party Motor Insurance Policy?
Here are the features of a third-party motor insurance policy:
It is the most basic type of vehicle insurance policy that the government mandates.
Third-party motor insurance is the most affordable vehicle insurance wherein insurance premium is decided by the IRDAI and remains constant throughout the insurers.
If a third-party person gets physical injury by your vehicle, then the insurer will cover their medical expenses.
If a third-party person becomes disabled permanently or dies because of an accident by your vehicle, then the insurance policy provides coverage.
How Does Third-Party Motor Insurance Work?
In case of an accident by the insured vehicle, if the third party gets damaged, the insurance company compensates it. In this way, a third-party motor insurance party lessens your burden. As a policyholder, inform your insurer as soon as possible after the accident.
While comprehensive motor insurance offers comprehensive cover to protect your vehicle for own damage and third-party liabilities, third-party insurance only covers third-party liabilities. So, this type of motor insurance policy can be a preferred choice for commercial vehicles.
Conclusion
In this article, we have learnt that the premium of a third-party vehicle insurance policy remains the same for almost all the insurers as it is decided by the insurance regulator of India i.e. IRDAI. Since they have defined rates, and is mandatory by law, one should always consider this as a necessary and additional cost while purchasing a new 2-wheeler or 4-wheeler vehicle.
