How does third-party car insurance help?

livemint.com:

—Name withheld on request Third-party (TP) insurance primarily addresses damages to bodily injury, fatal cases for the occupants travelling in the vehicle, and loss to any vehicle that you might have an accident with, as well as bodily injury or death of passengers of the said vehicle, any property that might be damaged due to your car, or injury or death of any pedestrian. This does not directly cover damages to your vehicle (also called own damage). In a scenario like a vehicle pile-up, where you impact the vehicle in front, your TP policy would cover damages to that vehicle subject to fault evidence established by the insured vehicle through court proceedings.

Typically, if the impacted vehicle has an own damage (OD) coverage, their insurance company will cover their damages, following the knock-for-knock policy which is a mutual agreement among insurers to handle their policyholders’ costs in an accident. Your vehicle’s damages would fall under OD coverage, which provides financial protection against accidents, fire, theft, natural disasters, and negligence. But, since you do not have an OD cover and only a TP cover, the cost of your vehicle’s damage may be covered by the impacting vehicle’s third-party policy if the fault is evident by the impacting vehicle as per police investigation.

However, the cost of damages will be decided by the court of law. In the unfortunate event of an accident, promptly contact your insurer and adhere to their documentation protocols. It is highly recommended to opt for a comprehensive insurance policy with add-ons for holistic financial protection.