Third Party Insurance Under MV Act: What Every Vehicle Owner Must Know

As interpreted in section 146 of the amended Motor Vehicle Act, 1988, it is recommended and compulsory third-party insurance for all vehicles in India. This legally means there could be no driving on public roads with any motor vehicle, such as an automobile, motorcycle, scooter, truck, or any other motor vehicle, unless, at the very least, they have a third-party insurance policy.

Third-party insurance covers only damages and/or injuries or perishing caused to another person or their property because of the vehicle while it is not included in the damage of the owner's car.

This rule is made to protect the innocent victims of road accidents and to help them recover the money they spend without fighting through a long time in the courts.

✅ Key Points:

• Mandatory for all vehicles (private or commercial)
• Cover liability due to injury, death, or property damage of a third party
• Driving without it is a punishable offence – fine up to ₹2,000 or jail
• Determinants of premium rates of third-party insurance are the IRDAI.
• New vehicles will have a long-term Third-Party insurance policy (3-5 years).

Compulsory Third-Party Insurance – FAQs

1. What is third-party insurance?

Compensation granted to third parties who suffer insolvency from any damage inflicted upon them by your vehicle.

2. Is this third-party insurance obligatory in India?

The same law applies; all vehicles in India must have third-party insurance according to the provisions of the Motor Vehicles Act.

3. What if I don’t have it and am caught?

Fines would be up to ₹2,000 or imprisonment for three months.

4. It covers damage to my vehicle?

Your vehicle damage is not covered at all; the loss of others is. For your own car, you need a comprehensive plan.

5. Can I drive a new car without insurance?

No. One needs to take third-party insurance prior to the driving off of a new vehicle.

6. How long is third-party insurance valid?

Usually one year, but for new vehicles, it is three years for bikes and five years for cars.

7. Who decides the third-party insurance price?

The IRDAI or Insurance Regulatory and Development Authority of India, set the price.

8. From which office can it be purchased?

You can purchase it from any licensed insurance company directly or online.

9. And injuring someone through an accident?

For such injuries, third-party insurance will take care of the medical expenses or compensation for them.

10. My vehicle is old and is barely used. Do I still need insurance?

Yes. All registered vehicles need to have insurance, even if rarely used.

11. What if my friend drove my car and caused an accident?

It is the owner of the vehicle, not the driver, who will be held liable. If the insurance was valid, it would cover this.

12. Can insurance firms deny me the right to take a third-party policy?

Not at all. Under the provisions, they are stated to grant it if you are applying with authentic papers.

13. What documents will I require to purchase third-party insurance?

Your vehicle's registration certificate (RC), ID proofs such as Aadhar or Voter ID, and sometimes a passport-size photograph.

14. When and how may I check the status of third-party insurance to see if it is still active?

You may check it on the VAHAN site or through the website of your respective insurer.

15. Does third-party insurance legally protect me?

Yes. It protects you from paying huge sums in compensation out of your pocket and provides you legal protection.