08/11/2022
1) First Party:
Have you heard the line – the customer always comes first? Well, this is an easy way to understand and remember who is the first party in car insurance. It’s you, the customer. When you purchase a car insurance policy from a certified insurer, you become the First Party in terms of the contract.
2) Second Party:
The insurance company from whom you have purchased the policy by paying the applicable insurance premium for your vehicle is the Second Party in the contract. The Second Party accepts the premium and offers the policy, which is a promise bound by the Policy Wordings. The Second Party assures the First Party that if anything untoward happens to the car, they will take care of it as per the terms and conditions of the policy.
3) Third Party:
A Third party is someone other than the First and Second party. It can be anyone; for example, a pedestrian walking on the street. These Third Parties can get affected because of your (First Party) car. Their property can get damaged because of a car accident. The First Party is liable to compensate the Third Party in such scenarios; and because the First and the Second Party have a contract in place, the insurer will handle the liabilities as a part of the third party insurance.
