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Insurance Article

How-to Claim Under Third Party Car Insurance

July 25 2016

What is third-party car insurance and what it covers

A car owner must carry third-party motor insurance under the Motor Vehicles Act, 1988. This government-mandated requirement ensures that in the event of an accident, he/she can compensate the aggrieved party for bodily injuries/death or material damages and take care of any legal liabilities arising from the accident.

Third-party vehicle insurance is a two-way street. While you might pay a third party in case of an accident due to your fault, this car insurance type can also be availed in case you are at the other end of the line.

Also known as ‘Act Only’ plan, this car insurance variant is specifically designed for damages sustained by a third-party. However, several insurance providers offer personal accident cover to the insured. This ensures that in the event of an accident, the car owner is not only capable of compensating the third-party but can also take care of himself and his loved ones, in case of personal injuries or even death.

Here are a few of the major claims that you can make from a third-party insurance holder in case of an accident:

  • Medical expenses claim in case of bodily injuries incurred due to the accident. You can also claim for treatment expenses for the injuries sustained.
  • A compensation claim for physical disfigurement.
  • Compensation for loss of earnings due to disability that prohibits from working.
  • A compensation claim can also be filed by the dependents of the third-party if he/she passes away due to the accident. This claim is based on the ground of the income lost due to death.
  • In the case of a claim filed for damages to the third party, IRDA has capped the compensation ceiling at ₹7.5 lakhs for insurance companies. However, in case the claim exceeds the capped amount, then the deficit has to be paid by the car owner.
  • There’s no regulated cap on compensation claims filed for injuries and death.

Now that you’ve familiarized yourself with the nitty-gritty of third-party car insurance, here is the complete process on how to claim 3rd party car insurance if you are the aggrieved one:

Third-party motor insurance compensation claim in case of disability, injuries or death

  • File an FIR with the police immediately after the accident and take a copy of the same.
  • Obtain the third-party motor insurance details of the car owner.
  • Take a copy of the charge sheet filed by the police against the car owner.
  • Hire a motor claims lawyer and file a compensation claim case in the Motor Accident Claims Tribunal. Remember, such cases do not fall under the jurisdiction of civil courts. The claim has to be filed in the tribunal court of the area where the accident has occurred or in the area where you (the claimant) resides.
  • In many cases, the car owner would suggest an out-of-court settlement, wherein a mutually agreeable amount is settled upon. Although this process is legally permissible, however, it’s best to get the authorities involved in case of an accident.

Third-party car insurance compensation claim in case of property damage

  • Property damage is inclusive of damage incurred by your vehicle and your personal property, including your house.
  • In the event of such damage, you need to file an FIR and get a copy of the same along with a copy of the charge sheet filed by the police against the offender.
  • The claim needs to be filed in the local tribunal court, where the compensation will be decided or rejected after taking into account the submitted documents as well as the story from both sides.
  • The maximum limit of compensation in case property damage is capped at ₹7.5 lakhs.

Although these steps might seem easy to take, getting a satisfactory 3rd-party car insurance claim settlement can be a tough road to walk on. Being a car owner, it’s best to secure yourself and others with comprehensive car insurance to avoid huge financial liabilities draining your savings.

Related Article:

Unbundling of Third Party & Own Damage Cover: What It Means For Vehicle Owners
Why Is It Important to Avail Comprehensive Cover Throughout Your Cars Life?

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