How to Calculate Third Party Car Insurance Premium Using Car Insurance Calculator?

Car insurance premium comprises of third party insurance premium and own damage premium. You can buy a vehicle insurance policy to cover either the third-party damage or complete damage. The comprehensive policy will cover the own damage as well as third-party damage. You should be able to understand the premium applicable for the coverage so that you can buy the vehicle insurance policy online without any issues. The insurance calculator will help you in this direction.

Let’s imagine-

While looking for the best car insurance for your recently bought XUV, you’ve found Tata AIG car insurance at per your insurance needs. However, before zeroing down on the plan, it will be great if you know the premium to be paid beforehand. Only car insurance premium calculator will help you figure out the exact amount.

Benefits of insurance calculator

You can buy the best car insurance plan by entering the specifications in the insurance calculator.

  • Comparison of policies –Various kinds of insurance policies across the insurance companies can be compared very easily by using the calculator.
  • Evaluation of insurance needs – If you are evaluating your insurance needs, it can be accomplished in the best possible way with the help of a calculator.
  • Save money – It is possible to save money by buying the most appropriate vehicle insurance policy. There will be savings up to 55% by using the calculator.
  • Save time – The calculator will help you in saving time as well.
  • Online policy – If you are buying third party insurance online, it can be accomplished in the best possible way with the help of the insurance calculator.

Coverage of risk factors

  • Legal liability – The third-party insurance plan will cover the legal liability. There will be unlimited legal liability if there is death or disability of third-party.
  • Loss of life – If there is the death of the third-party due to the negligence of the insured the insurance company will pay the compensation to the third-party. The compensation will be determined by the Motor Tribunal. The compensation is based on the earning capacity of the insured and the impact of loss on the family.
  • Damage of property –The compensation to the property damage will be awarded by the insurance company after ascertaining the loss. When the policyholder files the claim, the insurance company will process the claim. The extent of damage will be established and suitable compensation will be paid to the third-party.
  • Personal accident cover –The third-party vehicle insurance policy will cover the death or bodily injury. If there is a partial loss, the compensation will be 50% of the sum assured. If there is a permanent and complete loss, the compensation will be 100% of the sum assured.

Premium for third party insurance plan

You can find out the premium for third-party insurance plan by changing various parameters.

The parameters are listed below.

  • Engine capacity – As the engine capacity increase, the premium will also increase.
  • Property damage – The maximum coverage applicable to the third-party insurance policy is Rs. 7.5 lakh. The minimum coverage is Rs. 6000. If you buy the minimum coverage, there will be great savings.
  • Personal accident cover – The personal accident cover for the owner-driver will be either 50% or 100%. If there is a loss of one eye or one limb, the compensation will be 50%. If there is a loss of two limbs or two eyes or one limb and one eye, the insurance company will pay 100% compensation.
  • Goods & Services Tax –There will be an additional 18% tax on the premium.

Premium Calculator

The third-party insurance premium for cars will be decided by IRDA (Insurance Regulatory Authority).

The following rates are applicable from 1st April 2017:

Engine capacity Premium
Less than 1000cc Rs. 2055
Above 1000cc and less than 1500cc Rs. 2863
Above 1500cc Rs. 7890


  • The third-party insurance claim will be entertained by the insurance company subject to the fulfillment of conditions.
  • The vehicle should be registered in the name of the owner-driver.
  • The vehicle insurance policy should be bought in the name of the vehicle owner.
  • The owner of the vehicle should be in possession of a valid driving license.
  • Further, the provisions of Rule number 3 of the Central Motor Vehicle Rules, 1989 should be fulfilled.

Exclusions of the third-party policy

The auto insurance company will offer the third-party policy by applying certain exclusions. The exclusions are mentioned below:

  • Loss outside the geographical area – The loss that takes place outside the geographical area will not be borne by the insurance company.
  • Out of contractual liability – If there are claims that are out of the contractual liability, the claim will be rejected by the insurer.
  • Loss due to war or war-like situations – If there is loss due to war or war-like situations, the insurance company is not liable for damage.

Is third-party car insurance policy mandatory?

  • The third-party car insurance policy is mandatory as per the Motor Vehicles Act 1988. If you ride on public roads without holding a valid insurance policy, there will be a great risk.
  • It is illegal to ply on Indian roads without a valid driving license and valid vehicle insurance policy.
  • The damage of the third party (either person or property) should be covered by the vehicle insurance policy.
  • The maximum third-party compensation offered by the insurance company is Rs. 15 lakhs.
  • The maximum personal accident cover offered by the vehicle insurance policy is Rs. 2 lakh.

New regulations

  • As per the change in regulations effective 1stSeptember 2018, all new vehicles should buy compulsory third-party personal accident cover and third-party vehicle insurance cover.
  • Third-party personal accident cover
  • The maximum compensation due to the death of the vehicle owner was Rs. 2 lakh prior to the introduction of new rules by IRDA.
  • However, there is a drastic change with the implementation of new rules. The minimum compensation that you will get has been increased to Rs. 15 lakh.
  • The vehicle owner can opt for higher coverage by paying an additional insurance premium.
  • All the insurance companies should offer Compulsory Personal Accident (CPA) for vehicle owners. The minimum amount is Rs. 15 lakh and the maximum amount is Rs. 50 lakh.
  • If you register the new vehicle after 1stSeptember 2018, the vehicle should be covered by CPA for at least three years. Hence, you will want to pay the CPA premium for the first three years mandatorily.
  • There will not be the compulsion of CPA payment of three years for old vehicle owners. Old vehicles can be renewed on annual basis without any issues.

Migration of third-party vehicle insurance

  • If you buy a third-party vehicle insurance policy from insurance carrier A, you can switch over to another insurance carrier B.
  • If you are not satisfied with the services offered by the carrier A, you can migrate to another insurance company.
  • In some cases, the insurance carrier A may not offer features that are relevant to your needs. Hence, you can migrate to another company.
  • You can switch over from third-party vehicle insurance policy to comprehensive vehicle insurance policy and vice versa as per your convenience.

Buying policy online

The vehicle insurance policy can be bought online from the comforts of your home or office.

  • Buy or renew– You can buy a fresh insurance policy or renew the existing policy online
  • Quick quote – A quick quote can be obtained by submitting important information on the website. The parameters that are important to get the online quote are make & model of the car, registration number, registration place, policy expiry date and mobile number.
  • Comparison of premium – A quick comparison of premium and features offered by various insurance companies can be done by choosing the online medium. There are many insurance aggregators which will help you choose the best third-party policy as per your needs.
  • Informed choice – With the help of the online insurance calculator, you will understand the premium and various features that influence the premium. It is possible to make an informed choice when you are aware of various factors that influence the insurance premium.
  • Discounts – Auto insurance companies will offer various kinds of discounts for vehicle owners. By installing anti-theft devices on the vehicle, the vehicle will be protected.
  • Avoid brokers – You can avoid brokers and approach the insurance company directly by choosing the online platform. Insurance companies will offer a discount for online plans as they will be able to reduce the policy administration expenses.
  • Convenience – Buying or renewing an insurance policy online will give great convenience. You can complete the process instantly.
  • Renewing an expired policy – If a policy has expired, it can be renewed quickly by choosing the online platform. You should renew the policy on or before the expiry date to enjoy the benefits offered by insurance companies. However, you might fail to renew the policy before the deadline due to various reasons. You can approach the insurance aggregator online and the policy will be renewed quickly and efficiently.


It is not possible to compensate the bodily losses. However, the financial loss will be compensated with the help of the auto insurance. The third-party insurance should be purchased after ascertaining your needs as it is mandatory as per the law. The car insurance calculator will help you in choosing the most appropriate car insurance policy so that you can fulfill the obligations as per the law and it will protect your interests in a very efficient manner.