If you’re wondering about the difference between own damage and third-party insurance, you’re at the right place. We’ll break down these insurance types in simpler terms so that you can easily understand them.
Whether you’re renewing your policy or exploring different coverage options for car insurance, you should take expert advice. Hence, without wasting time, let’s dive in and demystify the world of our own damage and third-party insurance together.
Own Damage vs Third-Party Insurance
Let’s understand the difference between own damage and third-party Insurance using the following table:
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Point of Difference
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Own Damage Insurance
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Third-Party Insurance
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Coverage
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Own Damage Insurance provides coverage for damages to your insured vehicle. It includes accidents, thefts, natural calamities, and man-made disasters.
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Third-Party Insurance covers the liabilities arising from damages to third-party vehicles, property, or bodily injuries caused by your insured vehicle.
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Compulsion
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Own Damage Insurance is not mandatory under Indian motor laws. However, purchasing comprehensive coverage for the protection of your vehicle is highly recommended.
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Third-Party Insurance is mandatory by law to legally drive on Indian roads. It ensures you meet the minimum legal requirement for liability coverage towards third parties.
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Exclusions
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Own Damage Insurance primarily protects your vehicle and does not cover third-party liabilities.
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Third-Party Insurance excludes the cost of damages sustained by your insured vehicle. It solely covers the liabilities of third parties involved in an accident.
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Standalone Purchase
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You cannot purchase Own Damage Insurance as a standalone policy. It can only be availed with a Third-Party Insurance policy or as part of a comprehensive car insurance plan.
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You can purchase Third-Party Insurance separately, fulfilling the legal requirement for liability coverage towards third parties.
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Customisation
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Own Damage Insurance allows customisation by purchasing additional covers, commonly called add-ons. These add-ons enhance your policy's coverage, such as Nil Depreciation Cover, NCB Protect Cover, and more.
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Third-Party Insurance, being a mandatory cover, does not offer customisation options or add-ons. It provides standardised coverage as per the legal requirements.
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Validity
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Own Damage Insurance typically has a validity of one year, requiring annual renewal. It ensures your vehicle remains protected against unforeseen damages throughout the policy period.
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For new cars, a bundled Third-Party Insurance policy with a validity of three years is mandatory. It provides continuous coverage for legal liability towards third parties.
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