If you are making a claim against your own insurer, it is deemed to be a first-party claim. In contrast, if you are making a claim against another individual’s insurance policy, it is considered to be a third-party claim.
In a first-party claim, the insurance company owes you what are known as “fiduciary” duties. These are legal obligations that they have to the policyholder that state they must treat you fairly in relation to any claims or other business that they conduct with you. Basically, this means that the insurance company has to act in good faith as defined under the Insurance Code.
Under the terms of a third-party claim, the claimant does not have a previously established relationship with the insurer. Therefore, the insurance company does not have the same fiduciary obligations as in a first-party claim.
If you have questions regarding first or third-party claims, contact our law firm at 855-786-7674 and schedule a free initial consultation. Our attorneys are always happy to answer any questions that you may have.
What Are Some Examples of First Party Insurance?
First-party insurance provides coverage for the damages or losses of the individual named on the policy. A first-party claim occurs when the policyholder files a claim against their own policy. Some examples of first-party insurance include the following:
- Health or medical insurance
- Uninsured or underinsured motorist coverage in an automobile insurance policy
- Personal injury protection (PIP) coverage provided in an automobile insurance policy.
- Medical payment coverage provided in a homeowner’s or automobile policy.
- Damage to insured business or personal property that includes flood, fire, hail, wind, or other types of disasters.
What Are Some Types of Third-Party Insurance?
Insurance that is purchased with the intent to protect another individual against any liability for damages or losses that they caused. A third-party claim is made when a claim is filed against someone else’s insurance policy. The following are examples of third-party insurance:
- Product, public, and professional liability insurance
- Canine or animal liability insurance
- General commercial liability insurance
- Commercial motor vehicle liability coverage
- Liability insurance provided in an automobile policy
- Homeowners’ liability coverage provided for personal injury caused by the insured Umbrella policies
Why Are Third-Party Claims Sometimes More Difficult to Settle Than First-Party Claims?
In a third-party claim, the claimant is not the insured and is being made against the insured party, not the insurance company itself. As such, the insurer has no duty to the claimant and is not obligated to act in good faith. All duties are instead owed to the insured party.
It is easy to understand how a third-party claim can be complicated and difficult to navigate without the help of a skilled attorney. The attorneys at our law firm have a vast amount of experience when it comes to handling claims. We are not afraid to stand up to the insurance companies and fight for your rightful compensation.
Call our law offices at 855-786-7674 and ask to schedule a free consultation to speak with one of our knowledgeable attorneys regarding your claim.