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Your guide to third party property car insurance

Jodie Humphries avatar
Jodie Humphries
- 4 min read
Your guide to third party property car insurance

If you’ve recently bought a car, you’re probably wondering what the right insurance is for your needs. While comprehensive insurance might be your best bet, a more affordable alternative is third party property insurance.

Third party property car insurance covers damage that your car causes to someone else’s property or vehicle. If you’re wondering if this is the right policy for you, we’ve provided some information that could help you make a decision.

What is third party property insurance?

Third party property is a car insurance policy that covers the damage costs of other people’s belongings, such as their vehicle and their home. The policy only covers the damage to others property and not yours. Many insurers offer coverage up to $20 million.

While third party property insurance isn’t mandatory, it may be worth considering in order to ensure additional financial protection.

What does third party property insurance cover?

Compared to other insurance policies, third party insurance generally costs less as it offers less cover. This insurance covers:

  • The cost of repairing the damage caused by you to another person’s car.
  • The cost of repairing or replacing the damage caused by you to another person’s property.
  • Legal costs that occur while defending yourself against liability claims. 

Some insurers also offer partial cover to your car when you’re in an accident that is not your fault and the at-fault person doesn’t have any insurance.

What kind of exclusions does third party property insurance have?

While the exclusions usually vary from insurer to insurer, some of the general exclusions are common to most third-party policies. Some examples of when you may not be covered under this policy are:

  • If your car is overloaded with too much weight.
  • If you are using your car for commercial purposes, for example carrying other people’s luggage in exchange for money.
  • If you are driving your car under the influence of drugs or alcohol.
  • If the damage is caused due to a deliberate or reckless act.
  • If your car has been modified with non-standard accessories like turbo or supercharged engines or bull bars.

Is third party property insurance right for you?

While there’s no doubt that third party property insurance has its benefits, it may not be best suited for everyone. Consider these pointers to determine if this policy is right for you.

Could typically work for those who:

  • Don’t have an expensive car, as the policy won’t cover damages to your car
  • Can’t afford high premium rates at this time
  • Are looking for an affordable policy that covers more than the bare minimum, which is the mandatory insurance that covers only injuries to other people

May not work for those who:

  • Have an expensive car, as you will have to bear the cost of the damages to your car. Comprehensive car insurance may be a better option and provide you more suitable coverage.
  • Live in an area that has a high crime rate with the risk of theft of vandalism, as you won’t be protected against these acts. In such cases, it might be worth considering opting for a third party fire and theft car insurance.

How to find the most affordable third party car insurance

You could consider following these tips to help find the cheapest third party property damage car insurance.

  • Your premium rate is influenced by your driving record and claims history. That’s why it’s best to maintain a good driving record, which may reduce how much you pay for your car insurance.
  • Consider increasing your excess, which can result in reduced premium rates. However, you should only opt for this if you’re a safe and confident driver, or you might end up paying double the amount on what you saved! 
  • Consider buying online as some insurers may offer discounts if you opt to purchase their policies online. 
  • Opt for policies that provide additional benefits like offering lifetime cover or special discounts. 
  • Most insurers offer a bonus based on the number of years that you’ve not raised a claim. Contact your insurer to learn more about this provision in your policy. 
  • The cost of car insurance varies a lot from one insurer to another, even for the exact same make and car model. Hence, it’s best to shop around and compare third party property car insurance policies provided by various insurers to get a suitable deal that matches your requirements.

So, if you’ve determined that the third party property car insurance policy is right for you, you could begin your search by comparing your options.


This article is over two years old, last updated on November 29, 2020. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent car insurance articles.

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Product database updated 20 Jun, 2024