Different variants of third party insurance and its benefits

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While an insurance cover is primarily bought to cover expenses for any unforeseen damage that involves you, it’s equally important to have a cover in case those damages involve a third party. A third party insurance is an insurance cover purchased for protection against claims made by others. The most common third party insurance is the automobile insurance which is also mandatory in India. However, such insurance products can prove to be really effective in several situations which involves a third party claim.

Instead of paying from your pocket, a third party cover will compensate for such claims and act as the perfect financial shock absorber for unplanned expenses. Let us take a quick look into various kinds of third party insurance policies available at one’s disposal.

Third party accident insurance

If you don’t want to spend much on car insurance and need it merely to fulfil the legal prerequisites, a third-party cover is an ideal choice. Going by its name, this policy will only protect you from damages and losses caused to a third party but it won’t cover your personal damages.

It can include situations such as bumping into somebody’s vehicle or damage their personal property while driving. Meanwhile, if you hold a learner’s licence and were driving without a valid driving licence-holder as a co-passenger, your claim in those situations won’t be covered.

A third party cover is cheap, as the premium price is predetermined by the IRDAI based on your vehicle and engine, and covers only third-party damages. Such covers are considered sufficient for older vehicles that are driven rarely while the comprehensive cover is required for vehicles in frequent use. Also, one can benefit from the no-claim bonus during car insurance renewals if you don’t make a claim that year.

Renters’ Insurance

Mostly regarded as a temporary arrangement unless you buy your own home, renter’s insurance is a facility not many are aware of. Predominantly considered an additional expense, renter’s insurance is avoided assuming the landlord would anyway insure his property. But suppose, in case of an unforeseen situation like fire, theft or some other grave mishap in your rented apartment, the landlord can cover his loss but what about your personal valuables, furniture, electrical or mechanical appliances, clothes, etc.?

During a crisis like this one, renters’ insurance comes to your aid. It can also offer coverage if someone gets injured in your rental home by taking care of their medical bills. Simultaneously, it can also protect the policyholder if some third party files a lawsuit against them for the injury, etc.

Business liability insurance

Business owners and entrepreneurs are constantly under a variety of risks. It is of great importance for them to invest in a business liability insurance cover to protect themselves against claims arising due to an accident within their premises or if are sued for certain human resource policies. A business liability cover will ensure protection against third party claims for medical costs or potential lawsuits. It also includes coverage for legal costs against discrimination or harassment charges that may arise despite utmost precautions.