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DIFFERENCE BETWEEN COMPREHENSIVE & THIRD PARTY INSURANCE
When you have a car, it becomes important to have it insured. While the Motor Vehicles Act 1988 makes it mandatory to have car insurance, that is not the only reason why you should get it. To be more specific, it is mandatory to have at least third-party liability insurance. Broadly, car insurance policies are primarily divided into 2 categories: third-party insurance and comprehensive insurance. Before we take a look at both of them separately, let’s get to the benefits of car insurance first.
Benefits of Car Insurance
Coverage for Your Own Vehicle - No matter how safe and responsible a driver you are, you don’t have control over how others drive; the risk of being in an accident will always be there. If in case your car was to suffer damage, then getting it repaired can be an expensive affair. Imagine paying an exorbitant amount to get your car repaired for damage that isn’t even your fault? However, if your insurance cover provides proper coverage for own vehicle damage, then you are safeguarded from this risk. Reputed insurance companies offer vast networks of garages for cashless repair and hassle-free claim settlement.
Insurance Against Damage to Other Person’s Property - When you’re on the road, it’s normal for minor accidents to take place. And when that happens, it’s not just your car that will get damaged but someone else’s property too. In this case, you are liable to pay for the damage to the other person’s property. The third-party component of your car insurance will help cover this cost.
Personal Accident Cover - Some car accidents can be severe wherein the parties involved might receive major injuries. Even if you have saved enough for emergencies like this, bearing the cost of treatment from your savings isn’t the way to go about it. With the personal accident cover, you won’t have to worry about this expense either and can focus on the treatment and recovery.
Let’s take a deeper look at how Third-Party Insurance and Comprehensive Insurance work.
If you’ve reached this far while reading the blog, you must have started seeing sense in why third-party insurance is mandatory to have. If you are at fault in an accident and have caused damage to someone else’s property, third-party insurance protects you against this expense. Similarly, if someone else accidentally damages your property, they will owe you repair costs from their insurance. This is called third-party liability insurance.
Although the Government of India makes it mandatory to at least have third-party insurance, that doesn’t mean it’s the ideal option; at best, it’s the bare minimum you should have. The purpose of car insurance is to protect you and your car against damage as well, and this gets covered under comprehensive insurance. Comprehensive insurance includes not only third-party insurance but also personal accident cover and damage to your vehicle. The wide extent of coverage it provides is what makes it a sensible choice. Because of this, the price of comprehensive insurance is more than the price of third-party insurance.
When you buy a car, choose carefully whether you would like only third-party insurance or comprehensive coverage after comparing the pros and cons. Visit your nearest Muthoot Finance branch where you can get the right, real-time advice and the best options for your vehicle insurance needs.
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