What is the TP full form in insurance?
The TP full form in insurance is Third-party insurance. It is a liable insurance purchased by the owner of a vehicle from the insurance company to protect against the claims of another third party.
Need for third-party insurance:
Third-party insurance is a mandatory insurance policy owned by the vehicle owner before riding in public places. According to the Motor Vehicles Act, the owner who doesn’t hold the TP insurance will be fined and suffer three months imprisonment. Third-party insurance will shield the benefit of accident victims, and ensure them with proper compensation. In case of any damages, the insurance company covers up to a maximum amount of seven lakhs fifty thousand rupees as compensation. As the owner of the vehicle is responsible for their actions, TP insurance also aids in maintaining road safety.
Benefits of the Third party insurance:
The process of availing of TP insurance is very fast and simple. This covers a reasonable price even a common man can use it. It enables the insurer to drive legally on the road without any stress. It provides a shield for the insurer from facing any financial stress from an unexpected accident.