The general idea of third party auto insurance suggests this kind of policy would be related to someone other than the policyholder, and in fact, that’s the case. A working definition of this kind of insurance is that it includes coverage for payouts to third parties in the case of an accident. Third-party auto insurance is extremely important in today’s marketplace, because the cost of an accident, both in terms of damage to vehicles and bodily injury, are often so high.
A major part of third-party auto insurance is liability coverage. Some minimum liability coverage is actually mandated by most states for any registered driver in that state. Above that, some drivers take additional liability coverage to be sure that they will not be litigated if a third party wants to collect compensation for an accident. Liability covers property damage, bodily injury and specific amounts. What this looks like on your policy is a set of three numbers with vertical slashes between them.
When it comes to liability coverage, you want a healthy amount of coverage, so that you know a lot of the cost of an accident will be covered in a claim. However, you also want to know that the insurance company will pay the claim promptly, and without a lot of shuffling papers around. For the best policy in regards to third-party auto insurance, talk to your insurance representative up front and come up with a working solution for any claims that may arise down the road.