When an accident occurs, the financial and legal consequences can be stressful, especially if another person’s property is damaged. This is where 3rd party car insurance steps in. It is not just a legal formality but a safety net that ensures you do not end up paying heavy compensation out of your pocket.
Understanding how it works, especially in property damage situations, can help you handle claims more confidently and renew your policy with better awareness.
What is a Third-Party Property Car Insurance?
3rd party car insurance is the minimum legal requirement for all vehicle owners under the Motor Vehicles Act, 1988. It offers financial protection if your car causes injury, death or property damage to another person.
Unlike a comprehensive policy, which also covers your own vehicle, third-party insurance focuses only on compensating the affected party. The insurer pays the damages to the third party as determined by the Motor Accident Claims Tribunal (MACT). This keeps you legally compliant and protects you from potentially expensive liabilities.
At the time of car insurance renewal, this coverage continues to remain mandatory, even if you decide to switch insurers or upgrade your plan.
Understanding Property Damage Coverage
Property damage under third-party insurance refers to any loss or damage caused to someone else’s property by your insured vehicle. This could include another car, a boundary wall, a storefront or even public property such as road dividers or electric poles.
As per the guidelines of the Insurance Regulatory and Development Authority of India (IRDAI), the maximum compensation for third-party property damage is ₹7.5 lakh. This amount may be awarded based on the extent of loss and the Tribunal’s decision after reviewing evidence and repair estimates.
While this cover is highly valuable, it is important to remember that it doesn’t include damage to your own car or personal property.
How does the Claim Process Work?
If your car accidentally damages someone’s property, here’s what you should do to file a claim under 3rd party car insurance.
- File an FIR: Report the incident at the nearest police station as soon as possible.
- Inform your insurer: Notify your insurance company immediately and share all relevant details.
- Submit required documents: Provide the FIR, your policy copy, registration certificate, driving license and any photos or videos of the damage.
- Attend the Tribunal Hearing: The Motor Accident Claims Tribunal (MACT) reviews the case and determines the compensation amount to be paid by your insurer.
Once the Tribunal issues the order, your insurance company will pay the compensation directly to the third party.
Common Mistakes to Avoid During Claims
- Delaying intimation to your insurer can complicate or even void your claim.
- Not filing an FIR may lead to rejection, as police documentation is mandatory.
- Overlooking policy renewal may leave you without valid coverage during an accident. Always ensure your car insurance renewal is done on time to keep your protection active.
Conclusion
Property damage claims can be unpredictable, but having the right 3rd party car insurance ensures you are never left vulnerable. Insurers like TATA AIG simplify the claim process with digital intimation, transparent updates and timely settlements.
When it is time for your car insurance renewal, reviewing your coverage and renewing with a trusted insurer helps you stay legally protected and financially secure
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