Third Party Car Insurance & Own Damage Insurance: What You Need to Know

Posted on: Mar 10, 2025 | 3 mins | Written by: HDFC ERGO Team

Third Party Car Insurance & Own Damage Insurance: What You Need to Know

Comparison of Third Party Car Insurance and Own Damage Insurance

When it comes to different types of insurance, especially for your vehicle, it is important that you choose the right one. Different types of insurance tend to provide different types of coverage. Two of the most potential types of insurance that are covered by the car include third-party and own damage insurance.

Whether you are going for new car insurance or renewing your old one, it is advisable that you compare all the options. Getting expert advice can be helpful, especially when it comes to finding the perfect insurance and understanding own damage insurance meaning. It is advisable that you don't waste any time and then choose the cover accordingly.

What is Own Damage Insurance?

The own damage insurance covers the type of financial losses that the insured car's owner has to cover. Therefore, it will protect your vehicle against stealing, mishaps, devastations, natural calamities, and conflagration.

If you are an inexperienced car driver, you should consider taking your own damage insurance. It is slightly different from third-party insurance because it focuses on only protecting your car.

Benefits of Own Damage Insurance

Now that you know what is own damage insurance, it is important that you're aware of the benefits, too. Some of the common benefits of the own damage insurance include the following:

1. The insurance will offer protection against a wide range of risks such as natural disasters, theft, and also man-made calamities.

2. The own damage insurance offers coverage for repairs and replacement of your vehicle parts that may be damaged.

3. There may also be extra coverage along with the insurance, such as roadside assistance, accident coverage and medical expenses.

Regarding your damage insurance, you should know that the benefits will vary depending on each provider. You will have to do some research with each of the insurers so that you can make the right choice.

What is Third Party Car Insurance?

Third party car insurance refers to the policy that will protect your car against any third-party losses. Therefore, if you accidentally damage someone's property, the insurer will have to cover the cost. You must look into the benefits of them so that you can make the right choice.

Benefits of Third Party Car Insurance

Third party car insurance is slightly different from own damage insurance. Therefore, it is advisable that you look into the benefits before applying for the same. Some of the common benefits of third party car insurance are as follows:

1. The insurance will provide complete coverage for the third party. Therefore, there will be compensation in case of damage to the person's property or vehicle.

2. The third party car insurance will also cover the medical expenses for the third party if any injury may have been caused to them during the accident.

3. The third party car insurance will cover legal claims that may arise due to the accidents. However, you will have to meet the legal requirements and cover the basic liabilities without paying a high premium.

Difference Between Own Damage and Third Party Insurance

Both own damage and third party insurance have their own advantages and disadvantages. Therefore, you should understand the difference between own damage and third party insurance so that you can make the right choice.

Some of the key aspects for the difference between own damage and third party insurance are as follows:

1. Compulsion

As per Indian law, it is not really important to get your own damage insurance. However, it should be a type of comprehensive purchase as it will protect your vehicle against any unwanted risks.

According to Indian law, it is mandatory to get third-party insurance to legally drive on Indian roads. This ensures you can meet the minimum legal requirements for any liability coverage you owe to the pthird party.

2. Standalone Purchase

You will not have the option to buy your own damage insurance as a standalone policy. You can either avail it with a part of a third party insurance policy or a comprehensive car insurance plan.

You will have to buy a third party insurance plan separately. However, you will have to comply with third-party legalities to make the purchase accordingly. p

3. Exclusions

One of the main exclusions of own damage insurance is that it won't cover any third-party liabilities. However, it will provide protection coverage for your vehicle only.

Third party car insurance, as the name suggests, will only be covering the liabilities for the third party in the accident. Therefore, it will not offer coverage for the injuries pwhich may be covered by the insured vehicle.

4. Customisation

When you buy your own damage insurance, you do have the option of customisation. These are additional covers that are known as add-ons. The add-ons can be a part of your coverage and include aspects like NCB protect cover, Nil Depreciation cover and more.

Since third party insurance is mandatory, there is no requirement for any add-ons or customisation. It follows the legal requirements and manages the standardised coverage to avoid any unwanted damages. p

5. Validity

When you're applying for your own damage insurance, you will have to look into the validity. Usually, the own damage insurance comes with a validity of one year, which requires a yearly renewal. It will protect your vehicle against any unwanted damages within the given policy period.

As third-party insurance is mandatory, it is usually bundled with the car and has a three-year validity. However, within that period, the third parties' legalities must be covered to avoid any potential problems, especially in terms of legal considerations. p

6. Purpose

Own damage insurance replaces and repairs your car. It helps you against any unwanted mental trauma because of the accidents.

The third party insurance will protect the third party from any unwanted damage. It is mandatory and can be suitable for you when you phave a tight budget. It is a very affordable option.

Final Thoughts

Own damage insurance and third party insurance have their own benefits. It is advisable that you compare the prices and then choose the one accordingly. Choosing between them can be slightly difficult as they have their perks, and one of them is mandatory. Therefore, whatever you choose, you opt for the one where you can protect your vehicle.

FAQs

1. Should you buy your own damage insurance?

No, not necessarily. A standalone own damage insurance is not necessary. It is advisable to protect the car against financial losses, and it can also help cover legal fines.

2. Will third party insurance cover damage to my car?

Third party insurance will not provide coverage for the cost of damage to the car and other belongings in case of unforeseen circumstances. It will also not cover damages or stolen products.

3. Can I drive a car without my own damage insurance?

You should not drive the car without your own damage cover. It is advisable that you opt for proper insurance which will provide coverage.

4. How many times can I claim my own damage insurance?

You can file a claim for your own damage insurance as many times as you want. You should connect with the insurance provider, go through the clause and then file for the claims within a given financial year accordingly.

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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