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A motor third party is insurance that protects you from the financial responsibility of causing damage or injury to others while driving a vehicle. It does this by helping you pay for the expenses of someone else whom you accidentally harmed or whose property you damaged with your vehicle.
For example. If you are driving your car and accidentally hit and damage someone else’s car, then Instead of paying for the repairs yourself, the insurance company will cover the costs to a certain extent, so you do not have to foot the entire bill. However, this only happens if you have third-party motor insurance.
WHO NEEDS IT?
By law, all vehicles apart from government vehicles must have this insurance which must be renewed every 12 months before it expires. For example, if your third-party motor insurance expires on 12th July, then you should renew it before end of day on 12th July otherwise you may be charged with driving a car without this insurance and you could face imprisonment for up to 2 years, a traffic penalty or both.
Remember when we talk about vehicles, we do not only mean only your car with four ‘tyres’. By law, a vehicle is something that moves on roads and can be powered by different things like animals on a carriage, machines, electricity, or other sources of power. This could therefore be a car or motorbike. Please note that a bicycle(kigaali) does not fall under this category.
WHY IS IT CALLED THIRD-PARTY MOTOR INSURANCE ?.
Did you know the car insurance the traffic officer asks to see is called “third-party motor insurance” because it involves three parties or groups of people?
When you have a vehicle (a car or a motorbike) , you are the first party. The insurance company you buy your third-party insurance from is the second party. This means they promise to help you financially if something goes wrong. Now, the third party is someone else who could be affected if you have an accident or cause damage while driving like a driver of another car, a pedestrian or a bodaboda.
So, in case of an accident, the person whose car you hit or whose property you damage becomes the third party in this situation. They are not you (the first party) or the insurance company (the second party). They are a separate individual or groups affected by the accident.
So, it is called “third-party motor insurance” because it specifically focuses on protecting this third party (the person or people you harmed or whose property your vehicle has damaged) from having to worry about the bills and costs of that damage. In many cases, the insurance company agrees to pay for any loss up to a maximum of 1 million if it is one person who suffers the loss or 10 million if it is a group of people.
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