Where to get good solid information
When you have questions about an agent or an insurance company, one of the best resources is the Texas Department of Insurance website. The address is www.tdi.state.tx.us . When you go to the website, you choose what you want. If you are a consumer, click the consumer button near the top. If you are a business and want answers, click on the business button.
This is a great resource for anyone needing answers about their insurance policy and what their rights are. It will allow you to have some information so you can consult with your agent or the adjuster on a more level playing field about your insurance needs.
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Who are the parties to an insurance contract?
There are only two parties to an insurance contract. When reading consumer information, it may be helpful to determine who is being talked about.
The first party to the contract is the insured. They are referred to as “first party” when referring to specific types of policies. First party policies are referring to policies you bought to protect your personal belongings or house. They are usually property policies. The first part of your homeowners policy is first party coverage.
For example, if your house burns down, it is referred to as a “first party” claim since the insured himself will be making the claim. A collision claim is also “first party” since you are making a claim against your policy to pay for the damages received when you collided with another object. So, first party claims are when you make a claim against your insurance policy for damages to your stuff.
The second party to the contract is the insurance company . They promise to pay the claim promptly after receiving all the information they need to process the claim. Promptly is not defined in the policy and it may seem like it takes a long time. Just make sure you get all the information an adjuster needs and you should receive your settlement “promptly.”
So what is a third party claim? A third party claim is when you have been found negligent against someone else. These are called liability claims, for when you are legally liable to have to pay someone else’s damages. They can come from auto accidents or accidents at a place you own. For example, if you go out of control and hit another car or a building, the person whom you hit is the third party if you were at fault.
Third party claims have no official claim standards assigned to them. They can drag on for what seems like forever. Negligence has to be established and since Texas is a comparative negligence state, the adjuster will try to show that the injured party (the third party) was partially at fault. Many times a third party will retain an attorney if they feel they have serious injuries or feel they need someone to represent them against the insurer.
Can I be a third party against my own homeowners insurance? No. You cannot sue yourself. So if you slip and fall in your own house, you have no rights against your liability policy. However, if you are at a friend’s house or at a public place and are injured, you may have a claim against them for negligence. Then you will be a “third party” against their insurance.
This is just a simple definition of who is whom when it comes to property and casualty policies. It is not intended to be comprehensive, just a brief outline of who is whom when it comes to claims.
--Mary Roth CPCU