What is the difference between own damage and third party liability insurance?

When choosing car insurance, it’s crucial to understand the key differences between Own Damage (OD) Insurance and Third-Party Liability (TP) Insurance. Both serve different purposes, offering distinct types of coverage.

What is Own Damage Insurance?

Own Damage (OD) insurance provides financial protection for your own vehicle against various risks such as:

• Accidents – Covers damages to your car, regardless of who is at fault.
• Fire and Explosions – Protects against damage caused by fires, lightning, or explosions.
• Theft and Vandalism – Covers total loss if the vehicle is stolen or damaged due to vandalism.
• Natural Disasters – Provides coverage for damages from floods, storms, earthquakes, and other calamities.

This type of insurance is optional but highly recommended, especially for new or high-value vehicles.

What is Third-Party Liability Insurance?

Third-Party Liability insurance is mandatory in most regions and protects you from legal and financial liabilities if you cause damage or injuries to others. It covers:

• Bodily Injury or Death – Pays for medical expenses or compensation if you injure another person in an accident.
• Property Damage – Covers the cost of repairs if you damage someone else’s vehicle or property.

However, TP insurance does not cover any damage to your own vehicle, meaning repair costs will be out of pocket.

Key Differences Between OD and TP Insurance

Which Insurance Should You Choose?

If you only want basic legal protection, Third-Party Liability insurance is enough. However, if you want financial security for your own car, combining both OD and TP insurance (comprehensive coverage) is the best option.

Understanding these differences will help you make an informed decision and ensure that you have the right level of protection on the road.