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Third Party Car Insurance Claims
"Third party claims" are the most common type of auto insurance claim filed in the United States.
We'll review what third party claims are and how to file them.
What Is a Third Party Claim?
Any time you file a car insurance claim against someone else's insurance policy, you are filing a third party claim.
When would that happen? Here are a few examples:
- You were a passenger in a car when it was involved in an accident, and you were injured.
- You would file a third party claim against the driver's car insurance company for payment of your medical bills and other damages.
- You were the driver judged NOT at fault for an auto accident in a state without no-fault insurance.
- You would file a third party claim against the other driver's insurance company to recover damages.
- You were driving a company vehicle that was involved in an auto accident and were injured.
- Your claim against the company's insurance company is a third party insurance claim.
- You were driving your own car on work-related business and were injured in an accident.
- In this case, you may be able to recover expenses from your employer's insurance company with a third party claim.
In other words, any time you file an auto insurance claim in a situation where you are not the policyholder, you are filing a third-party claim.
Liability insurance, which pays for damages you cause to another, is required for the sole purpose of paying damages to a third party. Without it, you'd be left paying for those damages out of pocket, unless you live in a no-fault state (see below).
No-Fault vs. Tort States
No-Fault Insurance States
These types of claims are less common in states with no-fault auto insurance laws, where the laws typically require that you file a claim with your own insurer first. In this case, you'd file a claim through your personal injury protection (PIP insurance) coverage, which will pay for your injuries regardless of fault.
In most no-fault states, however, the law allows you to file a claim against the other driver's insurance company if your claim reaches the state's "serious injury" threshold.
In states that don't have no-fault insurance laws, like Arizona and Texas, you don't have to meet any threshold for filing a third party claim. You can file your claim with the other driver's liability insurance company if the other driver was at fault.
If there is a question about who is at fault, or if the injuries and damages are significant, the investigation of the accident may be lengthier. In some cases, you may have to go through courts for a settlement.
How to File a Third Party Claim
- Gather important information at the accident scene, if you're able to do so.
- File an accident report with the registry of motor vehicles, if it's required.
- Notify the other driver's insurance company as soon as possible.
- Cooperate with the insurance company's investigation.
- If your injuries are extensive or fault is in question, consider talking to a personal injury lawyer.
- Submit your bills and proof of expenses to the insurance company as they direct.
- Once you've filed a claim and the investigation is complete, you insurance company will approve or deny the claim. If the claim is approved, you'll be compensated.
3rd Party Claims and Subrogation: What You Need to Know
In some cases, your insurance company may pay out a claim on your behalf - by paying your doctor's bills, for example - in a situation where another party is at fault or should be held responsible.
In that situation, your insurance company may employ subrogation to recover the money it has paid out.
For example, say you were rear-ended by another driver and, in lieu of waiting for the other driver's car insurance provider to investigate the claim, you submit the claim through your insurance. Your insurance company would pay the claim but then seek to recover damages from the other party, since you were not at fault.
If you had to pay a deductible, your insurance company may be able to recover that as well.
Speak with your insurance provider regarding any questions about third-party claims and subrogation if you plan to file a claim with your own company.