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First vs. Third Party Insurance Claims: What are the Differences?


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Being injured in an automobile accident can cause months - if not years - of pain, suffering, and loss of income. Several steps should be made after an accident, including working with insurance companies. What you may not realize, though, is that there might be more than one type of insurance you'll be dealing with after your accident. To make the most out of your car insurance claim, it may be in your best interest to consult with a personal injury attorney.

Goodman Acker will help you determine whether you should file a first or third-party insurance claim to get just compensation for your Michigan car accident. In order to get started, it's essential to have a better understanding of first versus third-party insurance claims.

What Is a First-Party Insurance Claim?

minivan and coupe crashed with shocked onlookers
Image via Flickr by In Memoriam: -Tripp-

A first-party claim is an insurance claim between the first party (the policyholder) and the second party (the insurance company). These claims are contractual and are contingent on the insurance policy's specific language or contract. Basically, you're asking your insurance company to pay you for losses that occurred under the cover of their contract. Claims can be filed for the following:

  • Medical bills under a specified Medical Payment (Med Pay) policy.

  • Comprehension and collision coverages.

  • Rental coverages if you had to rent a vehicle while yours was being repaired.

  • Towing of the vehicle after the accident.

  • Underinsured motorist.

  • Uninsured motorist.

Your policy will specify what specifically you're allowed to file a claim for based on your coverage. Your insurance company may end up paying up to your policy limits for damages.

What Is a Third-Party Insurance Claim?

Third-party insurance claims are claims that are filed against someone else's insurance policy. These types of claims usually occur because you've been hurt in an accident due to someone else's negligence, and they have the insurance coverage that covers third-party liability. Imagine you're driving on the interstate and someone causes an accident in which you're injured. In this case, you would file a third-party insurance claim. The most common type of third-party insurance claim is a liability.

Third-party insurance claims may also pay for losses and expenses that aren't covered under your insurance policy. Examples of these include:

  • Loss of wages from being unable to work.

  • Medical expenses that occurred as a result of the accident.

  • Pain and suffering compensation.

How Do I Know Whether to Submit a First- or Third-Party Claim?

To determine whether you should file a first- or third-party insurance claim, you should look at who was at fault for the accident. In most cases, the party who caused the accident typically pays for damages. If fault can't be immediately determined, you may need to file both a first-party claim and a third-party claim. An expert personal injury attorney can speed up the process and maximize your compensation.

How Does the Claims Process Work?

Either type of claim begins when you notify the insurance company that there was an accident. They'll assign you a claim number and assign you a claims adjuster. This is someone appointed to investigate the accident and losses. After they get all of the information they need, they'll make a decision and either agree to pay you what you've asked for, deny your claim, or offer to pay you less than what you've requested. If you disagree with their decision, you may need assistance from a personal injury attorney to negotiate with the insurance company.

Some of these claims can be settled in a matter of weeks, while some claims with more on the line can take longer. The amount of time it takes to process claims depends on how much you're asking for, the situation surrounding the accident, and whether or not you've hired a lawyer.

Bad Faith Insurance Practices

Some insurance companies try to get out of paying what they, by law, are supposed to. This type of insurance practice is referred to as bad faith. A few examples to help you recognize if this is happening include if the insurance company doing the following:

  • Not providing a reasonable explanation for a denied claim or a claim that they wish to pay less than what you asked.

  • Denying compensation without reason.

  • Failing to reply or not replying in a timely fashion.

  • Failing to perform a thorough investigation.

  • Harassing the claimant in order to intimidate them.

Types of Accidents

Goodman Acker P.C. is proud to serve our Michigan clients for all of their personal injury claims. There are various types of accidents where first and third party insurance claims might come into effect. We offer legal services for the following and more:

  • Automobile accidents: millions of people are injured every year in automobile accidents, with more than a quarter of a million accidents taking place in the state of Michigan alone. Some of these accidents are serious enough to give you the right to a third-party claim against the responsible party.

  • Trucking accidents: Trucking accidents are usually more severe than your typical automobile accident due to the size and power of these large vehicles versus your passenger vehicle.

  • Motorcycle accidents: There are Michigan laws to distinguish motorcycle accidents from automobile accidents, but you're still entitled to compensation for damages and injuries. If you've been injured in a motorcycle accident, reach out to us to see if you're eligible for a claim.

Get Started on Your Claim Today

If you've been injured in an automobile accident, you may have the right to file a first-party or third-party insurance claim. Let Goodman Acker help you determine which is more appropriate for your situation. Reach out to our team of expert attorneys for your free, no-risk consultation today. Together, we can go over your case and start working towards the settlement you and your family deserve.

We have two convenient locations to serve you better. We have an office in Detroit at 17000 West 10 Mile Road, 2nd Floor, Southfield, and Grand Rapids at 1500 E Beltline Ave. SE, Suite 235. You can also contact us by phone at 248-971-4209 or online 24/7 by sending us a message.