Third party liability auto insurance is bought by a driver to pay for injury and property damage claims made by the occupants of the other vehicle when a collision occurs. These people are the third parties who are covered under the plan.
This type of coverage includes property damage and bodily injury liability insurance. Property damage coverage pays for repairs to the other driver’s vehicle. It also pays for the cost of repairs to any public property damaged or destroyed in an accident. This part of the policy pays for repairs to fences, guard rails, sign posts, traffic lights and mail boxes. It also covers the cost of repairs to any buildings, sheds or other structures damaged in the event.
Bodily injury liability insurance coverage pays for medical bills and rehabilitation expenses incurred by accident victims. It pays out a certain amount for funeral expenses if the accident caused one or more people to perish. The bodily injury liability coverage limit is also used to compensate the accident victim for his or her lost wages.
In some tort states for car insurance purposes, accident victims have the right to sue for compensation for their pain and suffering experienced as the result of an accident.
Drivers should consider their third party liability auto insurance needs carefully before deciding on a set policy limit. The exact level of coverage needed will depend on the level of assets that the driver needs to protect.