Filing First and Third Party Claims
If you are in an accident where you believe the other driver is at fault, and you
have first party insurance, you have the choice of filing either a first party or
third party claim.
If you choose to file a third party claim, you should contact the other driver’s
insurance company and let them know the details of the accident. If the third
party insurer agrees that its insured was at fault, it will pay for your accident
expenses, and your own insurance company will not be involved. The problem
with this approach is two-fold:
(1) It is often difficult and time consuming to work with the other driver’s
insurance company
(2) The other driver may not have sufficient insurance to cover your expenses,
in which case you will have to make a second claim to your own insurance
company under your Underinsured Motorist policy.
Many people, instead, choose to file a first part claim with their own insurance
company after any accident, provided they have first party insurance.
Recovering from their own insurance company usually involves a lot less
hassle and is much quicker.
In this case, if your insurance company feels that the other party was at fault,
they may ask you to “subrogate” (assign) your rights under your policy so they
can try to collect the money from the other carrier or the other driver. If your
insurance company is successful, it will get back the money it paid you. And
often times, they collect enough money to refund your deductible payments
as well.
Your insurance premiums should not increase as a result of this action.
