Answering Your Questions About Third-Party Insurance Claims
For any business owner, facing a liability lawsuit is overwhelming. Third-party insurance claims are particularly intricate, often placing your company in a difficult position between the claimant and your own insurance provider. You need clarity on your rights and your insurer’s responsibilities.
At McLeod Law Group, we focus on maximizing insurance recovery for policyholders. Our founder, John McLeod, has over 30 years of experience and is widely recognized, with an impressive record of recovering billions of dollars for organizations from insurance companies. Here, he answers some of the questions he gets asked most often about third-party claims.
What is the difference between a first- and third-party claim?
A first-party claim is filed directly with your own insurance company to cover a loss you sustained. A third-party claim, on the other hand, is a claim or lawsuit filed against you, the policyholder, by another person or entity. This claim asserts that you are legally responsible for their damages or injuries. This is often covered by your commercial general liability (CGL) or professional liability policy.
What is the role of your insurance company in a third-party claim?
When you face a covered third-party insurance claim, your insurer has a duty to you as the insured. This duty includes:
- A duty to defend: The insurer must hire and pay for a lawyer to defend you against the lawsuit, covering all litigation costs. This duty is very broad in California insurance claims and is usually triggered if there is even a potential for coverage.
- Duty to indemnify: The insurer must pay the resulting settlement or final judgment against you, up to the limits of your policy, if the claim is determined to be covered.
If the insurer denies either of these duties to its insured, it can lead to a serious claim denial dispute. Our lawyer can step in to compel the insurance company to honor these essential contractual promises.
What is the role of a claims adjuster in a third-party claim?
The claims adjuster works for the insurance company. Their role is to investigate the claim and determine the insurance company’s legal liability and financial obligation. The adjuster reviews the facts of the incident, gathers evidence, interviews witnesses and evaluates the damages asserted by the person suing you.
The adjuster makes recommendations to the insurer about whether to provide a legal defense or to attempt a settlement, and for how much. While the adjuster must act in good faith, their priority remains protecting the insurance company’s financial interests. They are not acting as your advocate. This is precisely why a San Diego third-party insurance attorney should be involved to oversee the process.
What type of evidence is collected in a third-party claim?
The evidence collected in a third-party liability claim is designed to establish fault, causation and the extent of damages. The specific type of evidence collected will depend heavily on the nature of the claim. However, evidence that is typically collected includes:
- Accident reports
- Witness statements
- Photographs and videos
- Medical records
- Expert opinions
We can manage the evidence review process. Our goal is to make sure that only accurate and relevant facts are used to determine your company’s liability.
Will a third-party claim increase my insurance premiums?
This is a valid concern for business owners. Usually, a third-party claim has the potential to increase your insurance premiums. This is especially true if the claim is large or results in a substantial payout. Insurance companies evaluate your risk profile based on your claims history. A significant liability payout suggests increased future risk to the insurer.
However, if your insurer attempts to wrongfully blame you, cites an inadequate reason to increase your rates substantially or even cancels your policy, we can advocate on your behalf.
How can a third-party insurance attorney help me?
Even if your insurance company has agreed to defend you, having independent legal counsel focused solely on your interests is vital for businesses facing a third-party claim. Our attorney provides critical legal support and strategic oversight throughout the entire process.
We can monitor the defense, challenge denials and protect your interests, making sure your insurer acts in good faith. We act as your advocate against both the claimant and your own insurance company. A skilled San Diego third-party insurance attorney will protect your organization’s assets and reputation during complex litigation.
Consult A San Diego Third-Party Insurance Claim Attorney
Do not allow a complex third-party claim to threaten your business or high-value personal assets. When you face liability, you need an attorney who knows how insurance companies operate and how to compel them to meet their obligations.
Our attorney is available by appointment for initial consultations to provide guidance on your third-party claim or liability issue. You can schedule an appointment by calling us at 619-433-6682 or by sending a message through our website.