Introduction
Comprehensive insurance refers to the type of auto insurance that covers third party liabilities as well as damage from accident, theft, vandalism etc. It means it covers third party claims and also provides financial protection against the damage to your car also. On the other hand, third-party car insurance provides protection against the damage to the third party (someone else's property) caused by your car.
Differences Between Comprehensive And Third-Party Car Insurance
Some of the key difference between third-party insurance and comprehensive insurance are as follows:
1. Meaning
Comprehensive Insurance: It is a type of car insurance that offers protection against damage to your own car as well as third party liabilities.
Third-Party Insurance: It is a form of automobile insurance in which only third party liabilities( damage to other people or their properties) is covered
2. Scope
Comprehensive Insurance: Scope of this insurance plan is wider than third-party insurance because it offers the highest level of financial protection to the owner of the car and third party.
Third-Party Insurance: Its scope is limited because it covers third party's liability only.
3. Coverage
Comprehensive Insurance: It provides coverage for third party damages, fire, natural disasters, theft, man-made damages, personal accident etc.
Third-Party Insurance: It only covers third party damages ( damages on properties or injury).
4. Mandatory Or Not
Comprehensive Insurance: It is not legally required so it is not mandatory
Third-Party Insurance: It is mandatory in most of the countries so it is compulsory to buy third party insurance.
5. Cost Of Premium
Comprehensive Insurance: Insurance premium will be higher than third-party insurance because of higher level of coverage.
Third-Party Insurance: The cost of this policy is lower than comprehensive insurance because of limited coverage
6. NCB And Discounts
Comprehensive Insurance: Insurance companies provides various discounts and no claim bonus (NCB) facility for this policy.
Third-Party Insurance : Generally insurers do not provide any discount and no claim bonus in this type of car insurance policy.
7. Suitable For
Comprehensive Insurance: This type of car insurance is suitable for those car owners who have luxurious and expensive cars and they drive regularly.
Third-Party Insurance: It is suitable for those auto owners having old cars with low market value and not having regular driving habit.
Also Read
Advantages and disadvantages of auto insurance
Factors to consider when buying car insurance policy
Tips to save money on car insurance premiums
Advantages and disadvantages of comprehensive insurance
Advantages and disadvantages of third-party insurance
8. Flexibility
Comprehensive Insurance: It is more flexible than third-party insurance because it can be customized (adding or removing adds on and other coverages) as per the requirements.
Third-Party Insurance: It is inflexible in nature because it cannot be customized.
Comprehensive Vs Third-party Car Insurance (Comparison Table)
|
Basis Of Difference |
Comprehensive Insurance |
Third-Party Insurance |
|
Scope |
Wider |
Limited |
|
Premium Cost |
High |
Less |
|
Coverage |
Third party and own damage |
Only third party damage |
|
Mandatory Or Not |
No |
Yes |
|
NCB /Discount facility |
Yes |
No |
|
Flexibility |
Yes |
No |
|
Suitable For |
New, luxurious and expensive cars |
Old cars |
* Comprehensive insurance provides coverage for both third party liability and damage to your own car, but third-party insurance only covers the damage cause to the third party.
* Comprehensive insurance is not compulsory but third-party insurance is compulsory for all car owners.
* Generally insurance premium will be high for comprehensive insurance because of wide range of coverage
* Customization is possible under comprehensive insurance but it is not possible in third-party insurance.
