Definition: Third-Party Insurance


An motor insurance policy purchased for protection against the actions of another party.

Third party insurance is purchased by the insured (first party) from an insurance company (second party) for protection against another party's claims (third party).

Investopedia Says       

Investopedia explains: Third - Party Insurance

Third-party automobile insurance is one of the more popular types of third - party insurance. Drivers are often required by their state to have adequate insurance coverage to ensure that damages resulting from an accident can be paid for.

Third-party in the case of automotive insurance would be the driver of the other vehicle, since that person is not the first party (principal) in the insurance policy.

Share:

No comments:

Post a Comment

Popular Posts

Blog Archive

Recent Posts

Featured Post

BSE releases list of 25 stocks available for T+0 settlement starting March 28, 2024

BSE releases list of 25 stocks available for T+0 settlement starting March 28, 2024