Insurance of motor vehicles Against Third Party

Risk
Third-party insurance is an insurance policy purchased for protection against the
claims of another. Third-party offers coverage against claims of damages and
losses incurred by a driver who is not the insured, the principal, and is therefore not
covered under the insurance policy. The driver who caused damages is the third
party.

Third-party insurance is essentially a form of liability insurance purchased by an

insured (first-party) from an insurer (second party) for protection against the claims
of another (third party). The first party is responsible for their damages or losses,
regardless of the cause of those damages.

As required by law, drivers must carry at least a minimal amount of bodily injury
liability and property damage liability coverage. A few states do not require both
or have other limitations. Each state sets its minimum requirement for each type of
coverage.

Procedure for providing compensation:

 According to Section 149 ‘The insurance company shall, upon receiving
information of the accident, either from claimant or through accident
information report or otherwise, designate an officer to settle the claims
relating to such accident.
 An officer designated by the insurance company for processing the
settlement of claim of compensation may make an offer to the claimant for
settlement before the Claims Tribunal giving such details, within thirty days
and after following such procedure as may be prescribed by the Central
Governmen
 If, the claimant to whom the offer is made (as said above) —

(a) accepts such offer

(b) rejects such offer