First Party Insurance Claims vs. Third Party Claims

Insurance agent checking the car damage to claim insurance.

If you have been injured in an accident in Colorado, your thoughts after receiving medical care are likely to turn to whether insurance will pay for your medical bills and other losses. But to obtain a settlement, you’ll need to be able to show who is at fault for the accident when you file an insurance claim.

Insurance companies pay claims for individuals they cover—their policyholders.After a car accident, for example, if you are at fault you might seek compensation for your car repairs if you have collision insurance. If someone else is at fault, you would seek compensation through their auto liability insurance.

Drivers are encouraged to exchange insurance information after being involved in a crash because they may need to contact the other driver’s insurance company.

  • A claim you file with your insurer is a first party claim.
  • A claim you file under an insurance policy held by another person, business or other organization is a third party insurance claim.

How Insurance Claims are Processed

Organizations like the Colorado State Patrol and the Rocky Mountain Insurance Information Agency advise motorists to contact their insurance company as soon as possible after a car accident. If you are not at fault but are sued by the other person involved in the accident, your insurance company needs information to defend you.

Frustrated man getting worried of the car accident.Frustrated man getting worried of the car accident.To obtain an insurance settlement after an accident, you have to deal with the insurance company representing the at-fault party, whether it is your insurer or another driver’s insurance.

Many insurers allow claimants to file initial information required for a claim online. You may also do it by phone. Once you have filed a claim, it will be assigned to a claims adjuster, who will soon initiate an investigation by contacting you.

The insurance adjuster will work to decide whether their company will pay the claim and how much they will pay. An adjuster will investigate who should be held responsible for the accident and the monetary value of your losses, such as for medical bills, property (vehicle) damage, lost wages, pain and suffering.

But make no mistake: an insurance adjuster’s job is to make sure the company pays the least amount possible to resolve the claim.

We suggest being cautious when speaking to an insurance claims adjuster. Anything you say will be held against you and the value of your claim.

  • Do not admit or accept blame for the accident.
  • Do not downplay your injuries or other losses.
  • If the adjuster asks you to record a statement, decline to do so.

Once the adjuster has finished their investigation, they will offer you a settlement or deny your claim. If you accept the settlement, you will be asked to sign a settlement agreement, which will end your claim.

Once again, you should be cautious of an insurance settlement offer. You need to be sure it covers your losses before accepting it.

In cases involving a serious injury, you should seek a personal injury lawyer’s guidance. Some insurers will offer what looks like a large settlement very quickly. But this is an estimate based on previous payments for similar cases. It has little to do with your actual injuries and losses. The full extent of your medical bills and related losses may not be known yet.

We suggest having a personal injury lawyer review your case, including any settlement offer, before you accept an insurance check. An initial consultation is free, and will include a review of all available facts about your case.

When an insurance company’s settlement offer is inadequate, you have the absolute right to negotiate for more. It is best to have an attorney negotiate on your behalf. Initially the attorney would submit a demand letter, which spells out what you consider a proper settlement and why. If the insurance company rejects the demand,then you can file a personal injury lawsuit, which states your demands and asks a court to award damages.

At this point, the average person is dealing with matters of law that he or she probably does not understand in a fight with insurance company lawyers who do this kind of work every day. Hiring an experienced personal injury attorney who represents accident victims in disputes with insurance companies will improve your chances of a successful outcome

Who is At Fault in Your Accident?

The type of accident claim you will file — a first party or third party insurance claim — depends on who is at fault for your accident.

If you were clearly at fault, you would file a first party claim according to what policies you hold and what they cover, such as your coverage for injuries, homeowners’ insurance, or automotive collision insurance.

Drivers arguing who should pay for the damages.Drivers arguing who should pay for the damages.For example, if you rear-ended another driver because you had turned for a second to speak to a passenger, or you fell from a ladder while cleaning rain gutters at your home, you would file a first party claim.

If another person or organization was at fault, you would file a third party claim under their liability insurance. This could include the other party’s auto liability insurance, or homeowners’ or business insurance, which have liability components for accidents on the policyholder’s buildings and grounds.

For example, a third party claim would follow a car accident caused by another driver, or a slip-and-fall accident in a store, or a dog attack.

Who is at fault for an accident is not always clear.Anyone can deny responsibility and/or make counter charges, particularly if they fear higher insurance premiums or out-of-pocket costs from a claim.This is why insurance adjusters are sent to investigate, and why you need to protect yourself by advising your insurance company of an accident and potential claim.

The best way to protect yourself is to have an attorney do an independent investigation of the accident. That way, if your claim is disputed, you have the evidence at hand to prove your right to compensation. This is another service provided by a personal injury attorney you engage after an accident.

Contact Our Denver Personal Injury Attorneys

Make sure your interests are upheld after an accident that leaves you or a loved one injured. A personal injury attorney is your advocate after an accident, working to demonstrate who is responsible and helping you recover the compensation you deserve for your injuries and losses.

The Sawaya Law Firm has established a Heritage of Justice from decades of serving Coloradans who have been injured through the carelessness of others. Our attorneys have been serving Denver and the rest of Colorado for more than 35 years as a dedicated personal injury firm. Our accident attorneys have the experience and know-how to help you hold the party responsible for your injuries accountable. For more information on how we can help, contact us today.


Michael established The Sawaya Law Firm in 1977 and built it into one of the largest personal injury law firms in Colorado, with more than 20 lawyers and 80 staff members serving clients from five offices located in Denver, Greeley and Colorado Springs. Throughout its history, the firm has stayed true to its 12 Core Values, which emphasize excellence in advocacy and a commitment to providing outstanding client service. Michael studied sociology and economics as an undergraduate student at The Colorado College, and he earned his law degree from the Texas Tech University School of Law. In addition to being involved in several legal and community organizations, Michael enjoys playing music and cooking, and he has written a book on spiritual matters.