What is First Party Claims?
First Party Claims occur when a policyholder files a claim with their own insurance provider for compensation for a loss that is covered under their insurance policy. This type of claim is common in personal insurance policies, such as homeowners or car insurance, where the insured individual seeks reimbursement for damages to their property or vehicle.
For example, if you have car insurance and your vehicle is damaged in an accident, you would file a First Party Claim with your insurer to cover the cost of repairs, depending on the policy terms. Similarly, in property insurance, if your home suffers damage from a covered event like a fire or storm, you would file a First Party Claim for the cost of repairs or replacements.
First Party Claims are distinct from third-party claims, where someone else is responsible for the damage and their insurance company is involved. In contrast, First Party Claims deal solely with the policyholder and their insurer, streamlining the process and ensuring that coverage is applied according to the policy terms.
Policyholders are encouraged to understand the scope of their coverage and the claims process to ensure they receive fair compensation for their losses.