First-party, second-party and third-party - if you are a prospective first-time car insurance policyholder, it can be quite confusing. What it is and how is it different from comprehensive insurance? Knowing this ensures that the focus is more than just about car air conditioner smells.
Most of us instinctively think of damage to our own vehicles when we think of insuring our cars. It is probably the primary reason we want to cover in the first place. Should anything happen to our cars in the event of an accident, theft, fire, damage or heaven forbid - come hail or hijackings - we had like to know that is not the sum total of our loss, as some financial ground can be recovered.
Comprehensive cover is expensive and has excesses but it is a better option compared to other options. If you cause damage to another car, other insurance options such as theft or fire only cover for damage caused to the other. Any damage to your car would be your problem. However, comprehensive option covers everything both the one at fault (yours) and the car of other (third party).
If you prefer to use public transport instead of driving your car, the probability of you causing an accident is next to zero. Let us say in an unfortunate event it happens that you cause the accident, you become the first party, your insurer becomes the second party and the person suffering from your actions is the third party. This option is very expensive if it happens that there is bodily harm caused by the accident.
It is most likely to be the driver of another car you drive into. Precariously though it could also be a retailer, for example, if you drive through a shop window; or a homeowner, should you ever crash into someone is front gate or garage. Certain individuals could also be excluded from the definition of third party in your policy. Persons who may be excluded include members of your household. Which means that there will be no cover should you damage a family members car.
It is clear that the insurance option does not cater for any loses you might have endured during the accident if you are in fault. This will mean forking out every expense from out of your pocket. Even so, some of these regulations are somewhat biased and not as clear as they are supposed to be. Question is who would be deemed liable in the case where an individual reverses from the driveway and bumps a neighbors car who happens to have wrongly parked their vehicle?
What is the neighbor should not have been parked in harms way in the first place? Well, then that individual has contributed to the making of the accident, essentially. In this case, an apportionment of damages claim will be assessed.
It will be decided what percentage of blame you are responsible for, and what your neighbor, is responsible for. This will then determine the amount of damage claim in monetary terms each party owes the other. In this scenario, when a third-party claim is filed against you, it is up to you to lay a counter third-party claim.
Most of us instinctively think of damage to our own vehicles when we think of insuring our cars. It is probably the primary reason we want to cover in the first place. Should anything happen to our cars in the event of an accident, theft, fire, damage or heaven forbid - come hail or hijackings - we had like to know that is not the sum total of our loss, as some financial ground can be recovered.
Comprehensive cover is expensive and has excesses but it is a better option compared to other options. If you cause damage to another car, other insurance options such as theft or fire only cover for damage caused to the other. Any damage to your car would be your problem. However, comprehensive option covers everything both the one at fault (yours) and the car of other (third party).
If you prefer to use public transport instead of driving your car, the probability of you causing an accident is next to zero. Let us say in an unfortunate event it happens that you cause the accident, you become the first party, your insurer becomes the second party and the person suffering from your actions is the third party. This option is very expensive if it happens that there is bodily harm caused by the accident.
It is most likely to be the driver of another car you drive into. Precariously though it could also be a retailer, for example, if you drive through a shop window; or a homeowner, should you ever crash into someone is front gate or garage. Certain individuals could also be excluded from the definition of third party in your policy. Persons who may be excluded include members of your household. Which means that there will be no cover should you damage a family members car.
It is clear that the insurance option does not cater for any loses you might have endured during the accident if you are in fault. This will mean forking out every expense from out of your pocket. Even so, some of these regulations are somewhat biased and not as clear as they are supposed to be. Question is who would be deemed liable in the case where an individual reverses from the driveway and bumps a neighbors car who happens to have wrongly parked their vehicle?
What is the neighbor should not have been parked in harms way in the first place? Well, then that individual has contributed to the making of the accident, essentially. In this case, an apportionment of damages claim will be assessed.
It will be decided what percentage of blame you are responsible for, and what your neighbor, is responsible for. This will then determine the amount of damage claim in monetary terms each party owes the other. In this scenario, when a third-party claim is filed against you, it is up to you to lay a counter third-party claim.
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