What are the key benefits of SBI Credit Cards?

SBI Credit Cards offer a wide range of benefits, including rewards, cashback, lounge access, discounts, and insurance coverage.

How can I apply for an SBI Credit Card?

You can apply for an SBI Credit Card online through the Paisabazaar platform, where you can compare card options and check for pre-approved offers.

What factors should I consider when choosing an SBI Credit Card?

Consider your spending habits, lifestyle, and financial goals to select a card that best suits your needs, such as travel, shopping, or rewards.

How can I manage my SBI Credit Card efficiently?

SBI Card offers a user-friendly mobile app and online banking services to help you manage your card, check statements, make payments, and access additional features.

What precautions should I take to avoid accumulating credit card debt?

Responsible credit card usage includes paying bills on time, managing credit limits wisely, and avoiding unnecessary spending to prevent debt accumulation.

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Trusted by 3 Crore+ Indians

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Goals upto 80% faster?

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Want to Achieve any of the below Goals upto 80% faster?

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Difference Between First-Party and Third-Party in Car Insurance

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Difference Between First-Party and Third-Party in Car Insurance

Introduction

Car insurance can often be perceived as complicated, filled with technical jargon and complex terms and conditions. Many people feel they need expert assistance to navigate the intricacies of insurance, be it for life, health, or vehicles. A common area of confusion is understanding the difference between first-party and third-party car insurance. Fortunately, the combination of internet resources and smartphone accessibility is making these concepts easier to grasp.

Simplifying Car Insurance in 2024

Understanding car insurance today is straightforward, thanks to user-friendly online processes. For instance, you can insure your car in just a few minutes by visiting websites like acko.com. However, it's still important to take the initiative to understand some basic terms. This article aims to clarify two fundamental concepts in car insurance: first-party and third-party. Read on to learn more about these terms and their implications.

Types of Parties Involved in Car Insurance

Car insurance involves a contract between two primary parties, with potential implications for third parties. To simplify, let's break down these parties:

First Party:

The first party is the customer, i.e., you, the car owner who purchases the insurance policy. In the context of the insurance contract, you are the first party.

Second Party:

The second party is the insurance company from which you purchase the policy. This company accepts your premium payments and promises to cover specified damages to your car as per the policy terms.

Third Party:

The third party refers to any individual or entity other than the first and second parties. This could be a pedestrian, another driver, or property that gets affected by your car. If your car causes damage to a third party, the insurance company (second party) will handle the liabilities on your behalf.

First Party in Car Insurance

As the first party, you initiate the purchase of a car insurance policy. This can be done easily online by visiting the insurance company's website and selecting a suitable policy.

What is First Party Insurance?

First-party insurance, also known as comprehensive car insurance, benefits the car owner. It includes third-party liability, own damage cover, and personal accident cover. You can also add specific coverages or add-ons to enhance your policy.

Own Damage Cover: This is a crucial part of first-party insurance, covering damages to your car due to incidents like fire, vandalism, flooding, theft, etc. Though comprehensive insurance is more expensive than basic third-party insurance, it offers extensive coverage.

Difference Between First Party (FP) and Third Party (TP) in Car Insurance

Here is a detailed comparison between first-party and third-party car insurance:

Meaning:

First Party (FP): The car owner who purchases the insurance policy.

Third Party (TP): Any individual or entity affected by the insured vehicle, other than the car owner and insurance company.

Scope:

First Party (FP): Includes anyone who owns a car and insures it.

Third Party (TP): Includes anyone injured by the insured vehicle or whose property is damaged by it.

Insurance:

First Party (FP): Can purchase third-party liability cover or an extensive comprehensive car insurance policy.

Third Party (TP): Can be proactive and secure themselves with dedicated accident or health insurance policies, though their injuries/damage will be covered by the first party’s insurance.

Compulsion:

First Party (FP): Must insure their vehicle with at least third-party liability cover as per the Motor Vehicles Act to avoid penalties.

Third Party (TP): No legal compulsion to buy an insurance policy.

Accident Cover:

First Party (FP): Receives a personal accident cover, usually bundled with the third-party liability policy.

Third Party (TP): Can get compensated based on the extent of damage and the Motor Accident Claims Tribunal’s judgment.

First-party Car Insurance

Now that the concept of first-party car insurance is clear, let’s delve deeper into the various aspects of this insurance type.

Types of Plans:

Basic Plan: This includes third-party liability cover, where premiums are regulated by the Insurance Regulatory and Development Authority of India (IRDAI).

Comprehensive Plan: Offers both third-party and own damage cover. Additional add-ons like zero depreciation, return to invoice, and roadside assistance can be included for extra premium.

Coverage of First-party Insurance:

What’s Covered:

Personal accident cover and third-party liability.

Own damage due to fire, flooding, vandalism, theft, etc.

Specific add-ons for enhanced protection.

What’s Not Covered:

Claims not covered by the policy or during the policy expiration.

Incidents involving driving under the influence or without a valid license.

Using the vehicle for commercial purposes or illegal activities.

First-Party Insurance Claim Process

To file a first-party insurance claim, inform your insurance company about the incident. They will guide you through the required documentation and the steps to process your claim.

How to Buy First-party (Comprehensive) Car Insurance from Acko:

Visit acko.com.

Select ‘Car’ from the menu.

Enter your vehicle details.

Provide necessary details like the car’s purchase year.

Choose a suitable plan.

Make the payment.

Download the policy once the payment is processed.

Third-party Insurance

Third-party insurance is mandatory for driving on public roads in India. It covers liabilities arising from injuries or damages caused to third parties by the insured vehicle. While it costs less than comprehensive insurance, it provides limited coverage.

Third-party Car Insurance Claim

For instance, if your car hits a pedestrian, resulting in injury, the pedestrian (third party) can file a claim against you (first party). The insurance company (second party) will cover the liabilities according to the policy terms. These claims are handled by the Motor Accidents Claim Tribunal, which can be a lengthy process due to the high volume of cases.

Conclusion

Understanding the differences between first-party and third-party car insurance is crucial for all vehicle owners. First-party insurance offers comprehensive coverage, including own damage and personal accident cover, making it a more extensive and beneficial option. Third-party insurance, while legally required, provides limited protection and is primarily focused on liabilities to others. By staying informed about these types of insurance, you can make better decisions and ensure adequate protection for yourself and others on the road.

Introduction

Simplifying Car Insurance in 2024

Types of Parties Involved in Car Insurance

Car insurance involves a contract between two primary parties, with potential implications for third parties. To simplify, let's break down these parties:

First Party:

The first party is the customer, i.e., you, the car owner who purchases the insurance policy. In the context of the insurance contract, you are the first party.

Second Party:

The second party is the insurance company from which you purchase the policy. This company accepts your premium payments and promises to cover specified damages to your car as per the policy terms.

Third Party:

First Party in Car Insurance

As the first party, you initiate the purchase of a car insurance policy. This can be done easily online by visiting the insurance company's website and selecting a suitable policy.

What is First Party Insurance?

Difference Between First Party (FP) and Third Party (TP) in Car Insurance

Here is a detailed comparison between first-party and third-party car insurance:

Meaning:

First Party (FP): The car owner who purchases the insurance policy.

Third Party (TP): Any individual or entity affected by the insured vehicle, other than the car owner and insurance company.

Scope:

First Party (FP): Includes anyone who owns a car and insures it.

Third Party (TP): Includes anyone injured by the insured vehicle or whose property is damaged by it.

Insurance:

First Party (FP): Can purchase third-party liability cover or an extensive comprehensive car insurance policy.

Third Party (TP): Can be proactive and secure themselves with dedicated accident or health insurance policies, though their injuries/damage will be covered by the first party’s insurance.

Compulsion:

First Party (FP): Must insure their vehicle with at least third-party liability cover as per the Motor Vehicles Act to avoid penalties.

Third Party (TP): No legal compulsion to buy an insurance policy.

Accident Cover:

First Party (FP): Receives a personal accident cover, usually bundled with the third-party liability policy.

Third Party (TP): Can get compensated based on the extent of damage and the Motor Accident Claims Tribunal’s judgment.

First-party Car Insurance

Now that the concept of first-party car insurance is clear, let’s delve deeper into the various aspects of this insurance type.

Types of Plans:

Basic Plan: This includes third-party liability cover, where premiums are regulated by the Insurance Regulatory and Development Authority of India (IRDAI).

Comprehensive Plan: Offers both third-party and own damage cover. Additional add-ons like zero depreciation, return to invoice, and roadside assistance can be included for extra premium.

Coverage of First-party Insurance:

What’s Covered:

Personal accident cover and third-party liability.

Own damage due to fire, flooding, vandalism, theft, etc.

Specific add-ons for enhanced protection.

What’s Not Covered:

Claims not covered by the policy or during the policy expiration.

Incidents involving driving under the influence or without a valid license.

Using the vehicle for commercial purposes or illegal activities.

First-Party Insurance Claim Process

To file a first-party insurance claim, inform your insurance company about the incident. They will guide you through the required documentation and the steps to process your claim.

How to Buy First-party (Comprehensive) Car Insurance from Acko:

Visit acko.com.

Select ‘Car’ from the menu.

Enter your vehicle details.

Provide necessary details like the car’s purchase year.

Choose a suitable plan.

Make the payment.

Download the policy once the payment is processed.

Third-party Insurance

Third-party Car Insurance Claim

Conclusion