Which insurer
First-party vs. third-party claims
Who owes you what when you claim on your own policy or against the driver who hit you, and how to pick the faster route for your car.
By Valoroath Editorial Team Updated 7 min read
In plain terms
A first-party claim is one you make under your own policy: collision, comprehensive, medical payments, PIP or uninsured motorist coverage. Your insurer owes you the duties in your contract, and you pay your deductible. A third-party claim is one you make against another driver's liability insurance. You pay no deductible, but that insurer pays only what its customer is legally responsible for, up to the policy limit, after it decides fault. When the other insurer is slow to accept fault, claiming on your own collision coverage and letting your insurer recover the money later is often quicker.
- First-party claim
- Your own policy
- Third-party claim
- Other driver's liability
- Deductible on third-party
- None
- Third-party fault rule
- Your state's law
Two kinds of claim
The NAIC model regulation on claim settlement practices, which many states have adopted in some form, draws the line this way. A first-party claimant is someone asserting a right to payment under their own insurance policy for a loss the policy covers. A third-party claimant is anyone asserting a claim against another person under that person's policy. The same crash often produces both.
First-party (your insurer)
Collision and comprehensive for your car, medical payments or PIP for injuries, uninsured motorist coverage when the other driver has none or too little. You have a contract with this insurer.
Third-party (their insurer)
The at-fault driver's liability coverage pays for damage and injuries its customer caused you. You have no contract with this insurer; it owes its duties to its own policyholder.
In the standard personal auto policy, first-party coverages sit in Parts B, C and D, and liability in Part A. Part A pays damages for which its insured "becomes legally responsible because of an auto accident," which is why a third-party claim turns on fault. How the policy parts fit together is in how a car insurance claim works.
How the two routes compare
| Question | First-party claim | Third-party claim |
|---|---|---|
| Who decides | Your insurer, under your policy | The other driver's insurer, under state fault law |
| Fault matters? | Not for collision or comprehensive | Yes: your share of fault can cut or bar the payment |
| Deductible | Yes, yours | No |
| Most it pays | Your car's actual cash value or repair cost, as the policy says | The at-fault driver's property damage limit, shared by everyone they damaged |
| Your duties | Notice, cooperation, proof of loss, inspection | No contract duties; you still must prove the loss |
| Limitation warning (NAIC model) | 30 days before the deadline to sue, if unrepresented | 60 days before, if unrepresented |
The NAIC model gives first-party claimants some protections third-party claimants don't get. The insurer must disclose all pertinent benefits and coverages to its own customer, and if it needs more than 21 days after proof of loss, it must tell the first-party claimant why in writing. Both kinds of claimant get the 15-day acknowledgment and the ban on unfair practices such as refusing to pay without a reasonable investigation.
Choosing a route for your car
If the other driver clearly caused the crash and their insurer accepts liability quickly, a third-party claim saves your deductible. If fault is disputed, the other driver hasn't reported the crash, or their insurer is slow, your own collision coverage can repair the car now. Your insurer then steps into your shoes and claims against the other side; the standard policy calls this its right to recover payment.
| Route | Paid to you now | Later |
|---|---|---|
| Third-party claim | $6,000, once their insurer accepts fault | Nothing more to recover |
| Collision claim | $5,000 ($6,000 minus $1,000) | Your insurer seeks $6,000 from the other insurer; if it recovers in full, your $1,000 can come back |
The NAIC model also says that when liability and damages are reasonably clear, an insurer should not tell a third-party claimant to claim on their own policy just to avoid paying. How the deductible comes back, and the state rules that protect it, is in subrogation and your deductible. Missouri, for one, requires your insurer to include your deductible in its demand on request; see Missouri claim rules.
When fault is shared or disputed
A third-party insurer pays only for what its customer is legally responsible for, so its answer depends on your state's fault rule. In a pure comparative fault state such as California, your payment drops by your share of the blame but is never cut to zero. In a state such as Illinois, you recover nothing if you were more than 50% at fault. In Virginia, a contributory negligence state, any share of fault can bar recovery from the other driver. Your state's rule is on its page in claim rules by state.
Your own collision coverage doesn't ask who was at fault. That makes it the steady route when fault is split or argued, and the main route in a contributory negligence state. It also matters when the other driver gave a different story to their insurer, which then waits for the police report before deciding.
- Open both if you need to. You can report the claim to the other insurer and to your own, then tell both which one you want to pay for the car. Don't let both pay for the same damage.
- Ask the other insurer for its fault decision in writing, including the percentage it assigns to you, so you and your insurer can answer it.
- Keep your own policy's duties in mind. You still owe your insurer prompt notice and cooperation even while you pursue the other driver's insurer.
Injuries are handled differently
- Medical payments coverage (Part B of the standard form) pays reasonable medical and funeral expenses for services within 3 years of the accident, whoever was at fault.
- Personal injury protection is required in no-fault states and pays first, under your own policy; in those states a suit against the other driver for pain and suffering needs an injury over a threshold. Our page on PIP and MedPay claims covers both.
- Bodily injury liability is the third-party route: the at-fault driver's insurer pays for your injuries up to its per-person and per-accident limits.
- Uninsured motorist coverage is a first-party claim that stands in for the liability insurance the other driver should have had; see uninsured motorist claims.
Questions people ask
Is it better to file with my insurance or the other driver's?
If the other driver's insurer accepts fault quickly, its liability coverage pays without a deductible. If fault is disputed or the claim stalls, your own collision coverage pays now, minus the deductible, and your insurer can recover the money and your deductible from the other side.
Do I pay a deductible on a third-party claim?
No. A deductible applies only to coverage under your own policy. A third-party payment can still be reduced by your share of fault, depending on your state's law.
Does the other driver's insurance company owe me good faith?
It must follow your state's unfair claims practices rules, which apply to third-party claimants too, such as acting reasonably promptly and not refusing to pay without a reasonable investigation. Its contract duties run to its own policyholder, not to you.
Will a first-party claim raise my premium if I wasn't at fault?
It depends on the insurer and the state; some states limit surcharges for accidents you didn't cause. See premium increases after an accident.
Sources on record
- NAIC — Unfair Property/Casualty Claims Settlement Practices Model Regulation (MDL-902)
- ISO Personal Auto Policy PP 00 01 01 05, filed with the Virginia State Corporation Commission, Bureau of Insurance
- NAIC — What does auto insurance cover? (June 11, 2026)
- Missouri Code of State Regulations, 20 CSR 100-1 — Unfair claims settlement practices
- Supreme Court of California — Li v. Yellow Cab Co. (1975), pure comparative negligence
- 735 ILCS 5/2-1116 — Illinois comparative fault
- Virginia Bureau of Insurance — Virginia Consumer's Guide for Auto Insurance (contributory negligence)
Facts on this page were checked against these sources on November 11, 2026. Fault rules and claim deadlines come from each state's law, listed on its state page.
Ask a licensed agent to review your coverage
After a claim, the policy you had is the one you can still change. Describe your situation and Valoroath passes it to licensed insurance agents and insurers who can review your coverage and quote, if you want them to. Valoroath itself does not sell insurance or handle claims.
- 1 Five questions about your car, your record and your policy.
- 2 Who to ask for, and your consent to be contacted.
- 3 A licensed insurance agent or insurer reviews what you have. You change nothing unless you choose to.
Sending this request shares your answers and contact details with the licensed insurance agents and insurers who receive it, which some state privacy laws treat as a sale; see your privacy choices. An agent reviews your coverage; they can't take on your claim or a dispute with your insurer. You pay Valoroath nothing. The licensed insurance agents and insurers who contact you pay Valoroath for requests and set their own prices and terms; your claim stays with your insurer. How we make money.
Next in the file
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How claims work
Liability claims against the other driver
What the at-fault driver's insurer pays, the limit that caps it, and how your share of fault cuts the check.
-
How claims work
Collision claims
What collision coverage pays for, how the deductible and your car's value set the check, and getting it back.
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How claims work
Subrogation and your deductible
How your insurer recovers from the at-fault driver, and how much of your deductible comes back.