What Is First, Second & Third Party in Insurance?

Buying motor insurance is a matter that requires great thought and careful analysis. You have to take numerous things into account. The most important among them is the type of insurance you choose. Consumers generally confuse among the terms- first, second and third-party generally used in motor insurance. A person who purchases insurance is known as the first party. Any insurance company, that provides insurance to a buyer is called as the second party. The service provider or insurance company is known as the second party. Damages caused to any vehicle plying on road, property or person is known as the third-party and considered to be a liability for any insured vehicle moving on road. Third party insurance, also known as third party liability policy or TP only is a legal requirement in our country. It is called third-party insurance because the coverage benefits someone outside the agreement between the insurer and the insured. It protects the damages caused to property or a third person driving or walking on road. For instance, someone else drives your car and it damages a person or property then third-party insurance comes in picture for compensation. Peace of mind is the greatest benefit third-party coverage has in store for you. It takes care of your legal liabilities in the instance of accident or damage to property to a third party. The policy generally offers low premium. It is a nominal expense IRDA determines from time to time. You can get it either online or offline. We’ve already mentioned the same above. Please remove/write in a better way. Importance of comprehensive insurance? When referring to motor insurance, people generally refer to car insurance. This happens because bike doesn’t offer protection from the elements of nature. Having comprehensive insurance protection is not a legal requirement in our country. Still, spending for the same offers you the following benefits: It is the most powerful protection available. Comprehensive insurance coverage allows you to claim reimbursement if your car is damaged in an accident. You can also service your vehicle in a network garage and file a claim. It protects you in the instance of disability or death. Comprehensive insurance coverage comes to your assistance if an accident causes permanent disability. The policy gives you the amount stipulated in your plan. Protection from thefts, fire, vandalism and natural disasters are the other benefits the coverage offers. Make sure that you are fully aware of the exclusions when buying third-party bike insurance. Drunk driving, staged accidents, under-aged driving and thefts are just a few to mention among them. Your insurer will reject the claim if the vehicle was used for a commercial purpose. If you find that the protection available is not enough, you can always go for add-ons. They come with nominal premiums and are easy to get. Remember, insurance is never a luxury. It is a must and a legal requirement that allows peace of mind.