First Party Claims vs. Third Party Claims

When filing a claim, there are certain things to be aware of, like understanding what kind of claim you are filing. Let’s say you are a concerned homeowner whose home recently received excessive water damage on their roof from a heavy rainstorm. When you file a claim with your homeowner’s insurance, what kind of claim are you filing? If you were driving down the road when a drunk driver T-Bones your car, and you file a claim against their insurance, what is this claim called? Filing a claim is a way one can compensate for experiencing any losses or damages. The two claims every policyholder should be aware of are First Party Claims and Third Party Claims.

When one files a claim, they type of claim that they file is all based on the type of situation that has taken place, and what they are trying to compensate for. If you were the culprit in a car accident and caused damage to another person or vehicle, it may not be a surprise when the victim files a claim against you-  this is called a Third-Party Claim. However, even if you are the culprit, if you have caused yourself any damages or injuries as well, you would still file a claim with your insurance. Even if this was your fault, you can still file a claim with your auto insurance company to try and receive compensation for your injuries and damages. This, is called a First Party Claim.

Third Party Claims

Any claim that is not made by the policyholder is considered to be a third party claim. This is typical with car accidents that involve injuries and damages. Since the opposing person sustained injuries, they would file a claim against the person who caused, or was involved with the accident. Since the opposing victim does not have an outlined contract with the opposing person’s insurance company, the victim would file a claim to compensate for things that may not be covered under the insurance policy. These “things” generally refer to receiving compensation for any excess medical expenses, loss of wages, and the amount of pain and suffering endured.


A third-party claim can also be known as a Liability Claim since the other party is liable for the injuries and damages suffered by the third party (opposing party). If the culprit’s insurance company is unwilling to offer a settlement with the injured, third party, the third party can bring such liability claim as a civil wrong in the tort system. The true, definitive purpose of a tort system is to permit the Court to review the negligence of a civil matter (much like the car accident).

First Party Claims

These particular claims are a little more intricate. First-party claims are held between you, the policy holder, and your insurance company (the insurer). Although every state differs in insurance requirements, there are still certain requirements that every consumer must face.

For example, most homeowners aren’t often required to purchase homeowner’s insurance. Even if homeowners don’t have a mandatory requirement to insure their house, most homeowners retain homeowner’s insurance anyway to protect what may be their largest asset. When a homeowner files a claim, or a first-party claim, with their insurer, it’s usually to receive compensation for any damages their home endured. Some causes of damages that may cause a homeowner to file a claim are water damage to a leaky roof, a fire causing severe burns and damages, burglaries or robberies, and any damaging earthquakes or floods.

As stated previously, one can still file a “first party claim” even if endured in a car accident. Whether it could have been your fault or not, filing a first party claim can help you compensate for the amount of pain, suffering, damages, and injuries received. This can be done by filing a claim with your own automobile insurance.

Bottom Line

Whether you have filed a claim against another policy holder or your own insurance, you can still receive the proper compensation you deserve. Unfortunately, there are insurance companies out there who practice “Bad Faith.” An insurer who practices “bad faith” often receives that title for failing to do what they are in business to do, insure for a damage or loss. Insurers can fit the title even more when considering the policyholder’s scenario was well-deserved for receiving compensation, when it was not.

If you or a loved one has witnessed a practice of bad faith from their insurance, contact our office today. Consulting with one of our trusted, experienced, and knowledgeable attorneys will help you compensate for your unfortunate loss and any injury you have tolerated. Our attorney can help explain your civil rights and detail how using your rights can help defend your case. Call our attorneys at JT Legal Group, now.

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1-888-LAW-3111 Monday-Friday, 8am to 6pm.

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