The term third party refers to a person involved with a car insurance claim who is not you the holder of the policy or the driver.

What is 3rd party insurance. According to the IBC in 2019 third-party liability claims payouts accounted for 466 of all direct claims incurred. When you take out an insurance policy youre forming a legal relationship with your insurance provider. Third party car insurance covers injuries or death of third parties due to an accident.

Basically third-party insurance is liability coverage thats purchased by a consumer first party from an insurance company second party to protect against claims from other people third party for injuries or damage the first party causes. It covers the victims property and any medical costs due to injury. This policy safeguards the interests of those who might be injured or whose property might be damaged because of an accident involving the insured vehicle.

In this relationship youre the first party and the insurer is the second party. TP premium depends on the Cubic Capacity. The own damage covers the loss or damage to the car due to insured perils while the third party covers the death of third party.

But the responsibility to settle claims under these plans is taken over by a third party administrator TPA. Third-Party Insurance in Nigeria In Nigeria third-party insurance is compulsory under the Motor Vehicle Third Party Insurance Act of 1950. Premium is fixed by the IRDA and is constant across the insurance companies.

Third-party liability coverage is the portion of an insurance policy that protects you if youre sued or threatened to be sued for a physical injury or damage to someone elses property. Motor third-party insurance or third-party liability cover which is sometimes also referred to as the act only cover is a statutory requirement under the Motor Vehicles Act. So this is usually the other driver involved in an accident.

Buying a health insurance policy requires an insurer. Third party insurance protects customers against financial ruin from potential claims for injuries or damages they may cause to another person. While costs differ from company to company the cost of repairs is normally fully covered minus your excess.