Third Party Auto Insurance: All You Need To Know About This Policy in Nigeria

What do you know about Third party auto insurance?

Third party auto insurance policy is compulsory in Nigeria, because it protects car owners from losses caused by their cars on other road users. The third party insurance was created to make an injured party “whole” as a result of a covered accident. Having to repair or replace vehicle damages and the cost of medical needs resulting from an accident can be very expensive. If the responsible party does not possess sufficient cover, the injured party would have little or no choice but to consider a lawsuit.

The Nigerian Insurance Act 2003 arranged for the compulsory Third-Party Motor Insurance in Section 68 of the Insurance Act, 2003. Section 68 of the Insurance Act and Section 3 of the Motor Vehicle (Third Party) Insurance Act requires that no person shall use, or cause or permit any other person to use, a motor vehicle unless such a motor vehicle is insured against damage to the property of third parties. According to the insurance law, for a driver to drive legally on Nigeria roads, it is anofficial requirement to have at least third party only (TPO) car insurance in order to guarantee that third parties involved in an incident are surely protected.

What this mean is that incase an incident occurs, and you are at fault and admit blame, then your insurance cover will pay out any sums of money that are granted to the people who are the ‘third party’ that may have been hurt or died, or their property has been damaged or written off.

What Does Third Party Auto Insurance Cover?

Third party auto insurance covers damages, especially injuries that drivers and passengers in other cars may have suffered as a result of an accident that was caused by a particular driver. This insurance comes into play when a policy holder is held responsible for the damage. Third party insurance deals with third parties, road users, drivers and passengers not at fault for the accident, but injured because of it.

Also, third party auto insurance will also help you pay for legal fees in case of any legal actions that may result from the incident.

Benefit of Third Party Auto Insurance

Third party auto insurance is good for your car because it will enable you to not carry the burden of repairing the car or taking care of other party’s bills alone should there be an accident. You should take note that it only pays for damages your car cause on others and ignores any loss you personally incurred in the process, be it your car damage or bodily injury.

If you want a “comprehensive cover” on your car, then you should get the comprehensive auto insurance that would take care of your own personal damages and that of any third party.

So, if you have a third party insurance and your car ran into your neighbour’s fence and destroyed part of the fence and your rear bumper as well, the insurance company will only take care of the bill of the damage on the fence, leaving you to your fate to repair your own car.

Other Things You Should Know About Third Party Insurance

You should only get third party auto insurance from a registered insurance company. There are various unregistered insurance companies that would not turn up when you need to make a claim. With genuine third party auto insurance, you will be able to save yourself the cost associated with causing damage on others.

Also, when you are acquiring a third party insurance policy, make sure you know the amount of claim you can get, because claim on an auto insurance policy is limited. Make sure to find out the limit to the loss the insurance policy covers before you subscribe. Usually, in Nigeria, insurance companies offer claim up to ₦1million.

If you need more information and would like to get a third party auto insurance for your new car or renew the policy for your old cars, you should contact this writer.