Third Party Insurance Claim

In a standard insurance claim, you are dealing with your own insurance company, and you are the customer. Sometimes, though, you are dealing with someone else's insurance company. When that happens you are said to be a third party to the claim, and you are not the customer at all! In fact, as the third party many companies may treat you like the enemy!

Let's say that someone has hit your house with their car, or installed a dishwasher that leaked, and it's their fault. If they have liability coverage on their vehicle or business then their insurance company will pay to fix your house, with three important exceptions!
First, they are not there for you; they are there for the guy that hit your house or installed the dishwasher. Expect that you may be treated differently than if you were the person paying for the insurance. For example, the adjuster may be suspicious of the damage that you claim. "Are you sure that concrete wasn't cracked before the car hit the house?" "That looks like old damage to me.....I don't think we owe for that." The company may not be as responsive as you might like; less prompt in returning calls, for example.

Also, under Georgia liability law they only owe you the actual cash value of the items that were damaged, regardless of what it will cost in today's money to repair. On a claim of any real size this can add up to thousands of dollars!

Finally (and this is a plus), you don't owe a deductible in a third party claim.

If someone else damages your property, you have a decision to make; do you deal with the other insurance company or do you make a claim under your own insurance? The answer, usually, is that it is better to claim it under your own insurance. Here's why. If you have replacement cost insurance, then your insurance company should pay the whole bill except your deductible. Then, your insurance company will make the other insurance company pay them back what they owe under Georgia law, which is the actual cash value of the damage. This process is called "subrogation," and when they get paid back they should give you your deductible back.

There are some exceptions to this, however. The biggest exception is if you have made some claims lately (particularly two in the last two years or so), then be careful making the third one. Your insurance company may decide to not keep you as a customer when the policy renews!

Often the best thing to do is to let the other company come out and make you an offer. If you don't like it, then you can always turn it over to your insurance company then.