With car insurance, insurance in place for third party claims are a requirement of the law.
So you can either have 'comprehensive' or '3rd party'
The main difference is that the costs of repairing/replacing your car are included in comprehensive (plus other sundry stuff).
Regardless of what policy you have you are always covered against claims made against you for damage to other vehicles and other stuff you might hit including people by your actions.
It appears here and from the extract provided above that there is no third party insurance being offered by the club to the pilot hiring and if said pilot is under instruction then the club is deliberately transfering all its risks onto the pilot under instruction - who is not being insured at all - in effect the "excess" is unlimited.
This might be against the unfair contracts acts assuming this transaction is regarded as a consumer related one and not a business to business one as well as some CAA rules.
So no, quite different in my opinion - as a layman not legally trained.