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First Party Insurance

What is First Party Insurance?

First-party insurance is a type of insurance that may refer to coverage of an insured party (the first party). It may also refer to coverage of an insured's legal liability for damages to another party (the third party). In the case of first-party insurance, the insured party is indemnified for losses from various damages or injuries, such as medical bills, lost wages, or property damage.

First Party Insurance in More Detail

Essentially, first-party insurance provides financial protection for the insured party. As the name suggests, this type of insurance is between the insured and the insurer, with no third party involved. First-party insurance may include coverage of property damage, medical costs, lost wages, and other related expenses resulting from an accident or other incident.

The policy will cover the insured’s liability for damage to the property or the contents of the property. For example, a person who purchases a homeowners insurance policy is the first party, and the insurance company is the second party. Likewise, an individual who buys auto insurance is the first party, and the insurance company is the second party. The policy will cover the insured’s liability for damage to another’s property or an injury to another person.

In summary, first-party insurance is a type of insurance that provides financial protection for the insured party. It covers the insured’s liability for damages to another party, medical costs, lost wages, and other related expenses resulting from an accident or other incident. The insured party is the first party in this type of policy, and the insurance company is the second party.

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