How to File a Claim for Third-Party Car Insurance?

Posted on: Oct 22, 2024 | 3 mins | Written by: HDFC ERGO Team

How to File a Claim for Third-Party Car Insurance?

Having car insurance, particularly third-party car insurance, is not only a legal necessity but also an essential form of financial protection in case of accidents. Whether you are the cause of an accident or find yourself at the receiving end, understanding how to file a third-party insurance claim is crucial.

This guide will walk you through the process, ensuring that you know your rights and how to file a claim efficiently.

What is Third-party Car Insurance?

Third-party car insurance is a policy that covers injuries caused by your vehicle to other persons and damage to their property. This type of policy is mandatory in India under the Motor Vehicles Act, 1988. The purpose of third-party car insurance is to protect insured drivers from financial liabilities if they cause an accident that injures another person or damages their property.

While it protects third parties, it does not cover the insured vehicle or the driver’s damages. However, certain policies may include personal accident cover for the driver, offering an extra level of protection.

What Does Third-Party Car Insurance Cover?

Third-party insurance primarily covers the following:

1. Bodily Injuries or Death:

If you are involved in an accident that causes injuries or death to another individual, third-party insurance covers the medical expenses, treatment, or compensation claims. This includes permanent disability claims that might arise due to the accident.

2. Property Damage:

Besides bodily injuries, this insurance covers damages to the third party's property, including their vehicle or any personal property that was destroyed during the incident. In India, this coverage is capped at ₹7.5 lakhs for property damage.

3. Legal Liabilities:

The insured party is also protected against legal liabilities arising from the accident. Third-party insurance helps cover any legal costs or court proceedings related to the claim.

Filing a Third-Party Insurance Claim

Filing a third-party insurance claim is different from claiming a comprehensive insurance policy. Here is a step-by-step process to follow:

1. File an FIR

Immediately after the accident, the first step is to file a First Information Report (FIR) with the local police. It is essential to take a copy of the FIR, as it will be required later during the claim process. The FIR should contain all the necessary details about the accident, including the people involved, the nature of the damage, and any witnesses who were present.

2. Obtain the Third Party Insurance Details

Ensure to obtain the third party insurance details of the person responsible for the accident. These details include the policy number and the name of their insurance provider. You will need this information when you file your claim.

3. Collect Evidence

Gathering evidence is a critical part of the claims process. Take photographs of the accident scene, the vehicles involved, and any visible damages. If possible, gather statements from witnesses of the accident. A comprehensive set of evidence will help prove your car insurance policy claim and make the process smoother.

4. Contact Your Insurance Company

While a third-party car insurance claim is generally made through the insurer of the party at fault, it is still advisable to inform your own insurance company about the incident. They can provide guidance and help you understand the next steps.

5. File a Claim in the Motor Accident Claims Tribunal

Third-party car insurance claims in India do not fall under the jurisdiction of civil courts. Instead, they must be filed in the Motor Accident Claims Tribunal (MACT) located in the area where the accident occurred or where the claimant resides. Once the claim is filed, the tribunal will examine the evidence and decide on the compensation amount.

Types of Third-party Claims

There are generally two types of claims that you can file under third-party car insurance:

1. Claims for Bodily Injuries or Death

In an unfortunate accident resulting in serious injury, disability, or death, the third party can file a compensation claim against the insured’s policy. The compensation can cover medical bills, loss of earnings due to disability, or compensation for the dependents if the individual passes away. While there is no upper limit on claims for bodily injuries or death, the process involves proving negligence and presenting medical reports and other evidence in court.

2. Claims for Property Damage

When property damage occurs due to an accident, the third party can claim compensation to cover repair costs. This includes damage to their vehicle or any other personal property affected by the accident. In India, the compensation for property damage is capped at ₹7.5 lakhs, which is the maximum amount the insurance company is liable to pay. In some cases, the actual damage may exceed this cap, and the party at fault might be required to cover the additional expenses out of pocket.

Common Challenges in Filing Third-party Claims

While the process of filing a third-party car insurance claim is straightforward, there are several challenges you may encounter:

1. Proving Fault

One of the biggest hurdles in filing a third-party claim is proving that the other party was at fault. Both parties may try to shift blame, making it challenging to determine liability. Gathering strong evidence and witness statements to support your claim is essential.

2. Out-of-Court Settlements

In many cases, the party at fault may suggest an out-of-court settlement to avoid legal complications. While this may seem like an easier and quicker option, it is essential to consider the fairness of the settlement offer. It is advisable to involve legal authorities, especially in severe cases of injury or damage, to ensure that your compensation is just.

3. Compensation Disputes

Even after a claim is filed, disputes can arise regarding the compensation amount. The insurance company may offer a settlement that does not cover the full extent of your damages, leading to lengthy negotiations or further legal action. It is important to have all necessary documentation, including repair bills and medical reports, to substantiate your claim.

Important Points to Remember

1. Insurance Caps:

As mentioned earlier, compensation for property damage is capped at ₹7.5 lakhs in India. However, claims for bodily injuries or death have no such limit.

2. Legal Advice:

In case of serious accidents, hiring a motor claims lawyer can help navigate the legal complexities and ensure you only pay the right compensation.

3. Time Limits:

It is crucial to file the claim within the stipulated time frame set by the insurance company and the tribunal. Delays may result in your claim being rejected.

Why is Third-party Car Insurance Important?

Third-party insurance serves as a safety net, protecting individuals from financial liabilities due to accidents. In a country where road accidents are common, having car insurance is not just a legal obligation but also a practical necessity. By covering the expenses related to third-party injuries and property damage, third-party car insurance ensures that you are not burdened with substantial financial costs in case of an accident.

Conclusion

Filing a third party insurance claim may seem daunting, but by following the proper procedures and understanding the legal framework, it can be a smooth process. Whether you are at fault or the victim of an accident, knowing how to navigate the claims process is essential.

Always keep the necessary documents, file the FIR promptly, and seek legal advice if needed to ensure a successful claim. Remember, having third-party car insurance is not just about complying with the law—it’s about protecting yourself and others on the road.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

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