Third-party insurance coverage is a type of insurance policy that provides coverage for damages or injuries caused to someone else by the policyholder. In other words, it covers the policyholder’s liability to pay compensation for any harm caused to a third party.
For example, if you are driving a car and you cause an accident that results in injuries to someone else, your third-party insurance policy will cover the cost of any damages or medical expenses that the other person incurs. However, it will not cover any damages or injuries that you or your vehicle sustained in the accident.
Third-party insurance coverage is typically mandatory for certain types of vehicles, such as cars, motorcycles, and commercial vehicles, in many countries around the world. It is designed to protect third parties from financial losses resulting from the actions of the insured.
