Dealing with a Third-Party Insurance Claim
A third-party insurance claim is what you file with the other driver’s insurance company after an accident that wasn’t your fault.
The term “third party insurance claim” is your best recourse for being compensated in an accident cause by someone else.
A third-party car accident claim is an industry term that invites so much confusion that even when an expert explains it, the definition can be misunderstood.
You, in fact, are the third party because you’re filing a claim for bodily injury and/or property damage with the insurance company of the driver responsible for the accident.
If you weren’t at fault in an accident, you may feel as if you have a minor role in the claims process and that you are owed a quick and friendly settlement. After all, you aren’t to blame, right? But that’s not the case at all.
Even as a victim, your work has only just begun. You need to be an active participant in making a successful claim – from collecting information post-accident, to obtaining a police report and perhaps to getting an estimate for damages to your car.
“You’ll need to call the other party’s insurance company, provide them with the policy number and a description of the incident, and share additional pertinent information, including a police report and witness information,” said Melanie Musson of CarInsuranceComparison.com. “They will likely contact their customer if they haven’t already heard from them.”
What Is a Third-Party Insurance Claim?
A third-party claim, in the simplest language, is when you file a claim with an insurance company that doesn’t carry your policy. If you file a claim with your own insurance company, that’s a first-party claim.
A third-party claim is your path to the at-fault driver’s insurance company compensating you for repairs to your car, your related medical expenses (in at-fault states) and possibly loss of income and/or transportation while your car is in the body shop.
“Third-party just means the other party that is involved in the accident,” said Nick Schrader, an agent with Texas General Insurance. “In states, car owners are required to have a Third Party Insurance Policy to cover them against third-party claims for injuries or death caused by accident.”
Third-Party Liability Claims
Most states allow you to file a liability claim with the at-fault driver’s insurance company.
The at-fault driver’s body injury liability coverage helps pay your medical expenses (emergency services, follow-up doctors’ visits, etc) and lost wages as a result of the car accident. (Liability claims are handled differently in no-fault states. More on that later.)
Just know that your state’s laws may set limits on the amount of compensation available for lost income. And while state laws establish various minimums on car insurance coverage, each driver’s policy determines the limits of compensation.
Third-Party Property Damage Claims
In filing a third-party claim for property damage, the at-fault driver’s auto property damage liability coverage may pay for repairs to your vehicle.
But it’s important to recognize that the damage to your car – say you have a newer model car and it’s a total loss – could exceed the limits of the at-fault driver’s insurance policy.
In that case, you could file a claim with your own insurance company for the difference, provided you carry underinsured motorist property damage coverage.
Another option is to file a claim with your own insurance company if your policy includes collision coverage.
How to File a Third-Party Insurance Claim
You can file a third-party insurance claim after contacting your own insurance agent, though you can file the claim yourself on the other driver’s insurance company online claims portal, too. A phone call is another option.
A free consultation with an experienced accident attorney can help you find the proper claims channel for your situation and best protect your interest.
“In Virginia (for instance) an insurance company is not going to file a personal injury claim,” said Adam Lotkin, a partner with Rutter Mills LLP in Norfolk. “Personal injury claims or lawsuits are PERSONAL to you, the injured person. The insurance carrier for the bad driver who injured you will not be helping you file a claim.
“For personal injury, you will want to go through the at-fault party’s insurance company, as long as their coverage is high enough to cover your claim.”
Regardless, the other driver’s insurance company or your own insurance company will want the same thing from you when you file a claim for property damage or bodily injury, meaning as much detail as you can provide, starting with the information you record at the accident scene.
“Your immediate steps following a crash are some of the most important for filing a third-party insurance claim,” said Musson.
1. Collect the Information Required to File a Third-Party Claim
Once safety concerns are satisfied following an accident, you need to collect all pertinent information and document what happened as completely as possible. The moments after a car accident are often where successful claims are hatched.
- Exchange information such as names, contact information and insurance information with the other driver.
- Get names and contact information of all passengers and, when possible, eyewitnesses.
- Collect photographic evidence of the specific damage to your car and wider shots of the scene that might show other details of the accident (how the cars were positioned, skid marks, etc.)
- Use your camera phone to take pictures of any injuries (cuts, bruises, etc.) Phone cameras can be key in supporting your case.
- Record license plate numbers, make and model of the car (or cars) involved.
- Get the responding officer’s name and badge number. Don’t forget the number of the police report he or she will file.
2. Contact Your Insurance Company
Most often, your insurance company will work with the at–fault driver’s insurance company to settle the case.
The last thing you want to do is invalidate the terms of your car insurance policy by not contacting your agent following an accident; even if it’s minor in nature, but especially if the property damage is more extensive.
Let’s face it. Most of us don’t pay attention to the fine print of policies (or sometimes even the larger print) so it’s a good rule to immediately call your insurance agent to protect your coverage, even if you weren’t at fault.
3. File the Third-Party Claim with the Other Driver’s Insurance Company
Contacting your insurance agent can help you determine whether you should file a third-party claim on your own, or whether it’s best the insurance company does it for you.
“Insurance companies (ultimately) determine who is at fault in an accident,” said Schrader. “So, it is good to work with your auto insurer on any claim.”
Keep in mind, though, your insurance company is looking out for its own bottom line.
After your claim is filed, the other driver’s insurance company will then assign a claims adjuster to your case.
4. Work with the Claims Adjuster
Claims adjusters are responsible for determining fault (no, they won’t take your word for it, even if you were an Eagle Scout).
They’ll investigate the accident and decide how much you’re owed for your trouble. You already know the spoiler. They don’t want to pay out more than they absolutely must. And sometimes they’re willing to drag out the process in hopes you’ll accept their initial settlement offer.
So be prepared to prove your case. Be prepared to recount details of the accident and share the evidence you’ve collected at the scene, including police reports and eyewitness testimony. Know that the claims adjuster may want to inspect your car for damages.
Unless the case is so obviously the other driver’s fault – for example, you were rear-ended by a driver who admits playing solitaire on his phone – the claims adjuster is almost certainly looking for shared blame in the accident to mitigate his company’s liability.
Share the information about the accident, but be careful to avoid a written statement or recorded conversation that could be used against you in the process of assessing blame. The same goes for any request to release your medical records.
If the process becomes contentious, or you suffered serious bodily injury as a result of the accident, consulting an experienced accident attorney can protect your interests and give you peace of mind.
“After you visit a doctor or go to the hospital/seek health care, contact your lawyer,” said Lotkin. “We can advise as to the perils of misstating issues or facts related to the collision and injuries and provide guidance about how to answer questions to the police, doctors, and insurance adjusters.
“In no way should you speak to the at-fault driver’s insurance company until your attorney gives you advice and counsel.”
5. Get an Estimate for Damages
You may have to get a damage estimate (or two) at the request of the other driver’s insurance company. What you don’t have to do is get that estimate at a body shop chosen by that insurance company.
Use an independent body shop that’s geographically convenient to you for the estimate(s). Choose a body shop that you would want to take the car to for actual repairs.
6. Negotiate a Third-Party Insurance Claim Settlement
The process went smoothly. You receive an offer to settle your car accident claim and it satisfies the damages you’ve incurred. It’s all good.
But what if it’s not? What if you’re not happy with the settlement offer? Chances are, you won’t be – at least initially.
“If the other insurance company causes you problems, you can work with your insurer,” said Musson. “Your insurer will not want to pay your claim, so they’ll help you ensure the at-fault party does what they’re responsible for.
“If the other party is uninsured or underinsured, your uninsured coverage will kick in to cover your costs beyond what the other party’s insurance will pay. But the primary coverage should be the at-fault party’s.”
Third-Party Claims in No-Fault States
In no-fault states – there are 12 of them – the process is different.
As a third-party claimant, you can file a claim for property damage with the insurance company representing the driver who caused the accident. But you would file the claim for your injuries with your own insurance company. Yes, even if the other driver was at fault.
In no-fault states, drivers are required to carry personal injury protection (PIP), which covers their own medical bills after an accident.
“(In no-fault states) Drivers have insurance to cover their own injuries and damages rather than insuring to pay out to the other party,” said Schrader. “Regardless of who caused the accident, both parties should file a claim with their own insurance.”
No-fault states limit the filing of lawsuits unless they meet certain thresholds. Whether or not you’re in a no-fault state, Musson says protecting yourself is critically important.
“Drivers should seek legal representation for any crash that causes significant injury,” she said. “Injuries can incur long-term bills, and you can’t risk not having them paid for by the at-fault party.”
- Hurst, A. (20221, March 31) What is a third-party insurance claim? Retrieved from https://www.policygenius.com/auto-insurance/what-is-a-third-party-claim/#how-to-file-insurance-claim-against-other-driver
- NA. (ND) When to File a Third-Party Claim after a Car Accident & How it Works. Retrieved from https://hensleylegal.com/articles/file-third-party-claim-car-accident-works/
- Leefeldt, E. (2020, March 25) How To Make A Claim Against Someone Else’s Car Insurance. Retrieved from https://www.forbes.com/advisor/car-insurance/car-accident-insurance-claim/