Insurance policies are often very confusing and complex. It may be especially confusing if a person is injured due to another person's actions in an automobile, truck, bus, motorcycle, construction, premises liability, or pedestrian accident, since there might be two policies--the policy of the injured person and the policy of the at-fault individual--that might affect the benefits the injured person ultimately receives. To help you understand how the various insurance policies operate, this Insurance Coverage FAQ page provides an outline of the types of coverage commonly available in bodily injury cases. Q: What is "first-party" coverage?
Q: What are some common features of first-party coverage?
Q: What is "third-party" coverage?
Q: What are some important aspects of third-party coverage that I should know about if I am seriously injured in an accident?
Q: How does first-party coverage fit in with third-party coverage? Q: What is "first-party" coverage?
A: First-party coverage is generally for specific items such as medical bills or lost wages. The three most common types of first-party insurance coverage include: - Automobile Personal Injury Protection (PIP) or Medical Payments coverage;
- Health Insurance; and
- Workers' Compensation coverage.
TOP Q: What are some common features of first-party coverage?
A: With regard to the automobile PIP or medical payments coverage, health insurance, and workers' compensation coverage, these first-party coverages share the following features: - No proof of fault required: You do not have to prove that the other person was responsible for your injuries in order to receive the stated benefits
- Benefits limited to your insurance policy: Your benefits are limited to the benefits stated in your insurance policy, or workers' compensation regulations if you were injured while on the job. In most circumstances, your benefits are limited to payment of all or some of your medical expenses and possibly reimbursement of your lost wages. Under workers' compensation coverage, you might also receive a "permanent partial disability award" if you qualify for this benefit.
- Medical bills or lost wages are paid as they accrue: Another critical feature is that the specified benefits will be paid as your medical bills or lost wages are accrued, which means that you do not need to reach a complete and final settlement of your claims in order to receive these benefits. You would simply have your medical provider bill the proper insurer--under your PIP, health insurance, or workers' compensation coverage--who should then directly pay your providers.
TOP Q: What is "third-party" coverage?
A: Third-party coverage usually covers all damaged items and covers claims for pain and suffering, disability and disfigurement, and personal distress caused by the accident or the injuries suffered. An important aspect of third-party coverage is that this type of coverage is provided under the at-fault person's insurance policy, instead of your own policy. Therefore, for example, if you are rear-ended in an automobile accident, the other driver's insurance policy will have third-party coverage for your injuries. This means that as the injured person, you are not the "insured" or "policyholder" of the other driver's policy, even though you might be the person who ultimately claims benefits under the policy. TOP Q: What are some important aspects of third-party coverage that I should know about if I am seriously injured in an accident?
A: There are important features of third-party coverage that injured accident victims should be aware of, such as the following: - Proof of the other party's negligence required: To collect benefits under the other party's third-party coverage, you have to prove every element of your case, specifically that the other party was negligent, that the negligence caused the damages, and the dollar value of the claimed damages. Insurance companies are often skeptical of claims; therefore proof is required to substantiate all claims.
- Third-party insurance carrier has no contractual duty to the injured person: The third-party insurance company has no contractual duty to represent or protect the interests of the injured person. This means that the third-party insurer has no duty to pay for your medical bills or lost wages as you accrue them. In most cases, reimbursement of medical expenses will be a part of the final settlement of the entire claim and is often made to the first-party insurer who paid the medical bills. Although in unusual circumstances third-party insurers may make limited payments before a case is completely settled, they do so on a voluntary basis.
- Third-party coverage applies to all items of damage that can be legally awarded: This is an important aspect of third-party coverage because an injured person can obtain compensation from the third-party insurer for all the damages he or she suffered, including medical expenses, lost wages, additional economic losses, pain and suffering, disability and disfigurement, and personal distress.
TOP Q: How does first-party coverage fit in with third-party coverage?
A: Ideally, a person who is injured in an accident will have the availability of both first and third-party coverages. For example, if a person is injured in a car accident due to the actions of another driver, the injured person can have his or her PIP or health insurance pay for the medical bills as they accrue. Then, ultimately, after the injured person has negotiated with the at-fault driver's insurance company about the damages incurred, the injured person can ideally attain a full and reasonable settlement with the third-party insurer. The reality is that many complications and difficulties may arise with either or both insurance companies, which is why the Law Offices of James S. Sorrels recommends that you consult an experienced personal lawyer if you have suffered serious or catastrophic accident injuries and another party was at-fault.
For an experienced and knowledgeable personal injury attorney, contact the Law Offices of James S. Sorrels, located in Edmonds, Washington, for more information or to arrange a consultation.
|
