Perhaps the easiest way to answer this question is with definitions and examples:

  • First-party. The insured injured victim of an accident.
  • Second-party. Usually, in an accident claim, this will be the insurance company.
  • Third-party.  Someone without a relationship with the other parties, but who may have some liability.

The first and second parties are usually bound by a contract.

If you are in a car accident, you (first-party) can go after your insurer (second party) for the damage to your car if you have collision coverage in your insurance contract. In addition, you (for your injuries) or your insurer (for the money they paid to fix your car) each have a claim against the person who caused or contributed to the accident (third party).

If you were at fault in an accident, there are only two parties to the claim.

Another example:

You are a carpenter and are hurt at work when the head of your hammer flies off and hits you. You (first-party) may be entitled to workers' compensation since you were hurt while on the job. You would make a claim against the workers' compensation insurer (second party) for your lost wages.

Easy, right? Of course, you may also have a claim against the manufacturer of the hammer (third party). While we’re at it, the workers' compensation insurer would also have a claim against the hammer manufacturer (also third-party) for whatever amount they paid out to you.

May of our clients don't realize they have a third party claim. It can make a big difference. For example, workers' compensation claims do not include pain and suffering, but third party claims do.

Contact Brooks & Crowley today, and we can evaluate your situation.

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