Third Party Insurance
Third party insurance is the minimum cover legally required by law. It is the most basic type of car insurance. It covers any damage to people or objects involved in an accident, not including you and your car. Your passengers are protected and you are covered for any claims against you as a result of an accident, if it is deemed to have been your fault. Third party insurance also covers any damage to other people or cars resulting from a caravan or trailer (which was attached to your car), but will not cover any damage to the caravan or trailer itself.
The total amount of cover you receive varies between insurers, but it is typically around twenty million pounds, often with extra money available to pay for third party legal fees.
Third party insurance is a good choice for anybody who wishes to reduce the cost of their insurance. You must remember that if your car is stolen or damaged in any way, you will not be able to make a claim. Third party insurance is therefore only suitable for low-value vehicles: in fact, insurers typically limit their third party policies to vehicles valued at under five thousand pounds.
Some insurers do not offer this type of car insurance. Quite often, insurers make their 'third party fire and theft' cover cheaper than their third party cover, because they believe that the protection provided by third party insurance alone is too basic. Many young drivers buy third party insurance, often because they have old, cheap vehicles, for which they do not need cover in the event of vehicle damage or theft. Statistically young drivers are more likely to be involved in an accident, and as a result, more claims are made against third party policies. In recent times, this has resulted in insurers increasing the price of third party insurance to cover the cost of claims against these policies.
Example Cover
You would never personally make a claim on your own third party insurance, as neither your car, yourself nor your possessions are covered by the policy. Possible examples where third party insurance would pay out include:
- where you have caused injury to, or death of your own passengers, a driver of another vehicle or any of their passengers, any pedestrians or cyclists
- where you destroyed or damaged another person's garden wall with your car
- where you damaged public structures, for example a traffic light, with your car
