Filing a First-Party Insurance Claim
Brian White | May 22, 2018 | Insurance Bad Faith
Learning the difference between a first-party and third-party insurance claim can be difficult. Knowing which to file after an accident, however, is important to the success of your claim. Understanding what differentiates the two types of claims in Texas can help you take prompt action in the event of an accident, injury, or natural disaster.
Explore the differences in more detail with help from an attorney. In the meantime, here’s an overview of why, when, and how to file a first-party insurance claim.
What Is a First-Party Insurance Claim?
A first-party insurance claim refers to a case in which the claimant or a natural disaster causes the damages, not an outsider or third party. Instead of someone else’s negligence causing the incident, it was the claimant’s own fault or an act of God, such as a hurricane, flood, or wildfire. In a first-party insurance claim, the insurer pays the insured person for losses sustained according to the limitations of the policy. If a third party caused the incident, that party’s insurance company may be liable for damages instead.
When Might You Need to File a First-Party Claim?
A common reason for someone to file a first-party insurance claim is after a natural disaster. In these cases, no third party may be responsible. Instead, the insured person only has his/her own insurance company to seek damages from. Another common situation for a first-party claim is if the claimant accidentally causes his/her own damages. For example, if you fell asleep behind the wheel and crashed your car, you might file a first-party claim with your own company for damage recovery.
Should a first-party insurance claim fail, the insured person may not have any other outlets for recovery. This is in contrast to third-party claims, in which the at-fault outside party’s insurer will cover damages. If a third party cannot compensate the injured person, the victim may have his/her own insurer to fall back on.
This is not the case in first-party claims. In general, a claim with the victim’s own insurance company is the only source of compensation available. Remember: If someone else caused your accident, you have a third-party claim, not a first-party claim.
How to File a First-Party Claim in Texas
Contact your insurance company as soon as possible if you suffer injuries in any type of accident, natural disaster, or catastrophe. Waiting too long could mean missing an important deadline and opening yourself up to allegations of insurance fraud.
Call your agent without delay to ensure you adhere to the rules of your company. Give your insurance company all the relevant details of the incident, including what caused it and a description of damages or injuries.
Your insurer will assign a claims adjuster to investigate your case. Do not admit fault for the incident or agree to giving a recorded statement to the adjuster. He or she generally wants to minimize your recovery – not do what’s in your best interests.
First-party claims can be especially difficult to negotiate, as the adjuster may try to reduce your recovery by placing the blame on you. For example, if you failed to dry your floors promptly after a flood, your insurance company may try to deny your claim for mold damages.
When to Call a Lawyer
Contact an insurance bad faith attorney if your insurance company tries to deny your first-party claim. Insurers will often try to deny claims or significantly reduce damages if they believe the claimant should have done something to prevent the incident, or based on a technicality.
A lawyer can represent you during insurance negotiations to make sure the company does not take advantage of you or convince you to settle for less than your damages are worth. Legal representation during a first-party insurance or bad faith claim can make a big difference in the amount of your recovery.