According to the UAE RTA law, it is mandatory for all vehicle owners to get car insurance cover. Also, a car insurance policy protects your vehicle financially in case of an accident or a natural calamity. In other words, the repair work on your car due to an accident is paid for by the insurance company.
“What can be the right type of motor insurance policy for me?” is mainly one of the most common questions people get before selecting an insurance policy. Buying any vehicle and car insurance and choosing the right type of policy can be a lot of work for you. So, you would need some key points to understand what type of insurance policy would be right for your vehicle. Don’t worry we have got you covered here as we’ll discuss all the major differences between comprehensive and third–party insurance and compare both to the point that choosing one would be a piece of cake for you after this.
Let’s first understand Comprehensive car insurance policies:-
Comprehensive Insurance policy:-
A comprehensive car insurance policy includes coverage for your own damage and repairs and replacements to your vehicle resulting from an accident. Comprehensive car insurance also covers third-party liabilities like risks which are related to the damage of third-party and vehicle. As the name says it is an extensive type of insurance that includes coverage for both own and third-party.
It provides coverage for liability to the third-party resulting from an accident and damage to the vehicle from accidents, fire, theft, wreckage, and natural calamities. The owner of the car gets personal accidental insurance coverage. The policy coverage can be further augmented by buying add-ons to the policy. One can buy the add-ons in order to minimize the burden of cost and expenses in case of any mishaps and a full-fledged car insurance policy would be the best to become totally stress-free
Benefits of comprehensive policies:-
Comprehensive car insurance protects the insured against the following:-
- Damage from falling objects
- Damage to the glass & windshield
- Damages caused by natural calamities like hailstorms, hurricanes, etc.
- Third-party liability like physical harm and damage to the third party.
- Accidental death or disability compensation to the owner of the vehicle.
Without a comprehensive insurance policy, you can’t file a claim for damage to your vehicle for any reason other than road accidents or mishaps.
Exclusions in a comprehensive car insurance policy:-
- Wear and tear or depreciation of the insured car.
- Mechanical or electric breakdown.
- Injuries or damage to the driver with no driving license.
- Damages caused if the driver is driving after consumption of any intoxicants.
- Damages to the tubes and tires and if in case of accidents the tubes and tires are damaged then the liability of the insurance provider would be restricted to 50% of the total replacement charges.
You can always buy the add-ons to your policy for coverage against these things.
Now let’s take a look at Third-party insurance:-
Third-party insurance basically covers any legal liabilities arising out of accidents and injuries to the third-party when a policyholder is at fault. It ensures damages or injuries caused by the insurer to the third-party or its property. “Under the UAE law, it is required, that every vehicle on the road is insured. ... You will be insured against all sums you may be liable for against any third party, such as loss of life, bodily injury, damages to vehicles or property caused by the use of your vehicle.”
Benefits of Third-party insurance:-
Third-party liability insurance is the most basic form of insurance in the UAE... This type of car insurance covers your legal liability in case of disability or death to any third party. In addition, it protects you against loss or damages occurring to the property of third parties. The beneficiary under this policy is the injured third party. Nevertheless, you are protected against legal and financial liability that may result to any third party.
Third-party insurance covers:-
- Compensation for any physical harm or bodily damage caused to the third-party.
- Damage to the property of a third-party caused by the insured.
- Personal accidental insurance covers the owner of the car.
Exclusions in third-party insurance:-
Third-party insurances don’t provide any compensation for damage to the vehicle or any belongings in the vehicle in case of accidents. Along with that it also won’t provide coverage for any damage to your car and if your belongings are stolen or theft.
Difference between a comprehensive and Third-party car insurance cover:-
There are pros and cons of both types of policies and it is important for you to understand certain factors in order to compare and analyze which one to go with:-
- The value of the car: - It is recommended to buy third-party insurance if the value of your car is low as you can pay the repair and replacement bills easily as compared to paying a high premium for comprehensive car insurance cover. On the other hand, if your car is new and expensive then you must buy comprehensive car insurance as it will give you better coverage.
- Coverage:- If you are looking for extensive coverage then you should go for comprehensive insurance as it covers both any damage to a third-party and its vehicle and protection against mishap for your vehicle too while the third-party insurance only covers the compensation for any liability to the third-party.
- Expense: - Comprehensive insurance is more expensive than Third-party compared to third-party insurance as it provides more extensive coverage to your car against damage caused by accidents, theft, fire, natural calamities.
As we saw If you want peace-of-mind and want to be stress-free regarding your vehicle then you must get yourself comprehensive insurance coverage as it will provide you coverage for everything and if you are low on budget and do not possess an expensive vehicle and do not use it frequently then third-party insurance must be enough. Also, You can calculate and compare the insurance through an insurance calculator Anyways, it is always better to think wisely and then take any decision than regretting it later so, you must analyze everything written above once again and then only come to any conclusion.