Buying car insurance is an important decision and should be well thought-out. Many things need to be considered while doing so, including which type of insurance coverage you require for your car; comprehensive or third-party. While making this choice, people often get confused. A major reason for that is because they are not fully aware of the two types of coverages and which one suits them. For this reason, we have outlined the features of comprehensive and third-party insurance and made a comparison to help you decide better.

What is Comprehensive Car Insurance?

As the name itself suggests, a comprehensive car insurance policy offers complete protection against damage caused due to any mishap or road accident. The plan covers not only damage done to your car but also covers theft, fire and third-party legal liability (damage caused to another party by your vehicle). Furthermore, the plan also includes damages done by a multitude of natural and man-made catastrophes. These include hurricanes, tornadoes, fallen trees or other objects, damage caused by any animals and damage caused during rioting or protests.

It also provides for personal accident coverage. In the comprehensive insurance plan, you get the option to choose additional coverage according to your needs by paying extra. These additional features include medical coverage, engine protection or accessories protection among other things. This allows you to customize the plan according to your needs and requirements.

Benefits of Buying a Comprehensive Car Insurance Plan:

A comprehensive car insurance Plan covers the following:
• Theft
• Vandalism
• Damage caused by a bird or animal
• Glass damage (such as a broken windshield)
• Fire
• Damage caused by a natural disaster such as a tornado, hurricane, sandstorm etc.
• Damage caused by falling objects, missiles, etc.
• Damage caused in flooding
• Damage caused in riots
• Third-party liability

A major benefit of having a comprehensive insurance plan is that you can file a claim for damages even if the mishap is not a road accident. Most of the afore-mentioned coverage clauses are not covered in a Third-Party Insurance Plan.

What is not included in a Comprehensive Insurance Plan?

The following coverage is not provided in a comprehensive insurance policy:
• Depreciation of the vehicle
• Mechanical or electrical breakdown of the vehicle
• Any damage caused while driving without a driving license
• Damaged tires and tire tubes
• Any damage caused while driving intoxicated

Third-Party Insurance Plan

A third-party insurance plan provides coverage for any legal liability that may arise due to damage or injury caused to a third-party when you (the policyholder) are at fault. This basic level of insurance is mandatory for every motor vehicle driver who is driving in the UAE. This policy only covers the damage caused to another person by your car and does not cover the damage caused to your own car, which makes it lower in cost than comprehensive plans.

What is included in a Third-Party Insurance Plan?

A third-party insurance plan provides coverage for you, the vehicle owner, for any legal liability that may accrue on you, which may include death or bodily injury caused to the third-party or damage caused to their property. The following are included in your basic
Third-Party Insurance plan:
• Any damage caused to the third party from your vehicle including theft or fire (such as accidental fire causing broken windows or property)
Death or bodily injury to the third party caused by insurance holders vehicle (such as broken bones)
What is not included in a Third-Party Insurance Plan?
A Third-Party Insurance Plan does not provide coverage for any damage caused to your own car. It also does not cover the following:
• Any damage caused during an accident to either person or property
• Any property was stolen from you

Comprehensive vs. Third-Party Insurance

There are many factors that you need to keep in mind when you are choosing between the two insurance plans. A comprehensive insurance plan is more expensive than a third-party insurance plan, but it also provides you more coverage.

A comprehensive plan covers for your personal injuries or property damage, third-party liability and also damage caused by natural and man-made disasters. If the value of your car is high and you are seeking to cover a wide array of possible damages, then it is suitable for you to opt for a comprehensive insurance plan. A third-party insurance plan covers only any legal liability that may arise from damage to a third-party and does not cover damages incurred by your vehicle. Which is exactly why the comprehensive plan is recommended.

Author's Bio: 

Umar Saeed is a Contributing Editor at BuyAnyInsurance Blog. He writes a blog about car insurance & other insurance products. He loves writing on the connecting dots between Fintech and real-world consumer behavior.