At the time of choosing a car insurance policy applicants often get confused about which policy to buy. While, a comprehensive car insurance policy provides all round cover against damages to your car. A third party car insurance policy will cover against legal liabilities to a third party caused due to the policyholder's fault. Hence, to help you make informed choice here are the policies explained.
Comprehensive car insurance policy
Comprehensive insurance is a cover which lets you pay for replacement or repair of your vehicle in case it gets stolen or damaged in an incident which is not a collision. It covers damage from vandalism, fire, and falling objects like a tree. The policy can be enhanced by choosing additional covers such as accessory cover, engine protector, medical expenses, zero depreciation cover, to name a few. The limit on this cover is typically the actual cash value of the car. In case, you finance or lease a car your lender would ask you to buy a comprehensive cover. Whereas, this cover becomes optional if you own the vehicle.It provides end-to-end coverage for the car, towards expensive repairs of your car following an unforeseen event or an accident . This plan is comparatively a little more than a standalone third-party insurance plans. Nevertheless, it provides a lot more benefits to the policyholder.
Third party car insurance policy
This policy covers only the financial liability to the third party when the mishap has been caused by the policyholder to any third party or their property. This cover is mandatory under the Motor Vehicles Act of 1988 and it has no limit on the liability cover for death or injuries of the third party. However, the cap for property damage is Rs. 7.5 lakhs. It lets the third party file a claim for compensation against damages caused by your vehicle. In this case, your car insurance provider will bear the claim on your behalf.
Read Also: Comprehensive vs Third Party Car Insurance – Which One To Choose?
