What is third-party motor insurance?

1. Motor third party insurance or third-party liability cover is compulsory for all motor vehicles under the Motor Vehicles Act

2. The insured is one party, the insurance company is the second party, and the person the insured has injured and who is claiming damages is the third party.

3. The policy covers the insured for accidental damage to other people’s property and also for causing accidental injury or death to other people.


4. The policy does not cover damage to the vehicle of the insured, or injuries suffered by the insured.

5. Driving under the influence of intoxicating substances like alcohol or drugs, driving without licence, deliberately causing an accident are some of the reasons that will make the claim invalid.

(The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)