The difference between a first-party and third-party insurance claim in Chicago comes down to whose insurance company you are asking to pay for your losses after a car accident. A first-party claim involves your own auto policy, while a third-party claim seeks compensation from another person’s insurer.
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What Is a First-Party Insurance Claim?
A first-party claim is filed when you are seeking benefits available under your own auto insurance policy. After a car crash, a first-party claim may involve collision coverage for vehicle repairs, medical payments coverage for qualifying medical expenses, or uninsured and underinsured motorist coverage when the responsible driver has no insurance or not enough coverage.
Since you have a contract with your insurer, it must provide the coverage promised under its terms and properly investigate claims for those benefits. The company cannot deny a covered claim because payment would be expensive. If it disputes your claim, the disagreement may involve whether the policy covers the loss or satisfied the policy requirements, or how much the insurer is required to pay.
What Is a Third-Party Insurance Claim?
A third-party claim is made against the insurance policy of the person or business responsible for your injuries. In a typical car accident, this means seeking compensation from the at-fault driver’s liability insurer. The relationship is different because you do not have an insurance contract with that company.
The liability insurer investigates the accident before deciding whether its insured is legally responsible. It may dispute how the crash happened, argue that you contributed to it, or question all of your injuries and expenses.
Can You Have Both Types of Claims After the Same Car Accident?
It is possible to have a first-party claim and third-party claim after the same accident. This often happens when your own coverage pays an expense before the liability claim against the other driver is resolved.
For example, you may use your collision coverage to repair your vehicle rather than waiting for the other driver’s insurer to accept responsibility. If your insurer pays for the damage, it may later seek reimbursement from the at-fault driver’s insurance company through subrogation. Subrogation allows an insurer that paid a covered loss to recover that payment from the party responsible for causing it.
A first-party claim may also be filed when an at-fault driver does not have enough insurance. You can pursue that driver’s liability coverage first and then make a first-party claim under your own underinsured motorist coverage for additional compensation, subject to your policy and coverage limits.
Having two claims does not allow you to collect twice for the same loss. Instead, the claims can work together to provide access to the available insurance while the insurers determine their respective payment obligations.
How Can a Lawyer Help With First-Party and Third-Party Claims?
Insurance claims become more difficult when you are dealing with different companies, different coverages, and different reasons for denying or limiting payment. A Chicago injury lawyer can identify the insurance available after the accident and determine which claims can be pursued.
An attorney can also address disputes with the at-fault driver’s insurer while protecting your rights under your own policy. If one company denies coverage, another disputes responsibility, or the available liability insurance falls short of your losses, your lawyer can determine what options you have.
Understand Which Insurance Claims Apply to Your Accident
If you are unsure whether to pursue your own insurer, the other driver’s insurance company, or both, Mark L. Karno & Associates, LLC can review the available coverage and help you decide what to do next.
Call (312) 701-0090 or send us a message online for a free consultation.