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A Look At The Exclusions Of A Third Party Motor Insurance Policy

The Motor Vehicles Act of 1988 has made it legally necessary to purchase a third party insurance policy for your vehicle if you wish to drive it on Indian roads. So, in the unfortunate circumstance of your vehicle getting into an accident and damaging someone else or their property, your insurer will take care of the third party liabilities. While it is definitely helpful in this scenario, it may not be of assistance in certain other situations involving your car. Let’s go through the exclusions of a third party motor insurance policy.

  1. Damage to your own vehicle in an accident

If, in an accident, your car suffers damages as well as the third party, the damages to your car will not be covered by this policy. The third party insurance policy is also called a liability-only policy as it only covers the expenses you are liable for in an accident.

However, depending on the situation, you can raise a claim on the third party’s motor insurance policy and get due compensation.

  1. Damages caused to third party due to driving under influence

If the accident that caused damages to the third party happened when the policyholder was under the influence of alcohol or any drugs, the insurer will not be liable to pay for any expenses. Drunk driving is considered a criminal offence under prevalent laws. Therefore, no claim under such circumstances will be entertained.

  1. Damages caused to third party when driving without a valid driver’s license

When your vehicle causes damage to another vehicle or person in an accident, it is important that you have a valid driver’s license with you. If you are found without one, the insurance company can reject your claims and refuse any payment.

  1. Damages to third party’s property costing above Rs 7.5 lakhs

While there is no limit to the amount that the motor insurance company can pay in cases of accidental injuries or death of the third party, the damages to property has an upper limit. The insurer is only liable to pay up to Rs 7.5 lakhs in case of property damage. If the compensation is more than that, the balance has to be borne by the policyholder.

  1. Damage to insured vehicle due to natural or man-made disaster

A third party insurance policy will not cover any damages caused to the vehicle due to natural disasters such as storms, hurricanes, lightning, landslides, and so on and man-made disasters such as fire and theft.

  1. Damages to third party in an accident outside of certain location boundaries

Insurance companies often have geographical boundaries within which they cover the insured vehicles. If your vehicle gets involved in an accident outside of these pre-mentioned geographical boundaries, then the insurer can exclude their coverage.

  1. Damages caused if the car is being used for commercial purposes

If the accident occurs and it is found that you had been using your private vehicle for commercial uses or any other purposes other than its authorized use, the claim will not be considered. This exclusion, of course, does not stand for a commercial vehicle insurance policy.

Several of these can be covered with a comprehensive motor insurance policy. So, the next time you are going through your car or bike insurance renewal, do consider what coverage you require and opt for an insurance policy accordingly. Regardless of which policy you pick, do not forget to go through the policy wordings.

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