First party claim
What is a first party claim: first party claim explained
A first party claim is a claim a policyholder makes against their own insurance policy for their own loss, settled by their own insurer under the contract between the two of them. Collision and comprehensive motor claims, buildings and contents claims, health claims and business interruption claims are all first party.
For insurers
See the damage before you send anyone
Venta Capture, a product of VentaVid, sends the policyholder a link. They film the damage on their own phone, guided step by step, and the evidence lands with the claim.
The counterpart is the third party claim, where the person claiming has no policy with the insurer paying. Which of the two a file is decides who owes what duty to whom, whether an excess bites, and roughly how long the claim will run.
Who the parties are
The numbering is older than the jargon and it is literal.
- First party: the insured. The person or business named on the policy.
- Second party: the insurer. The other signatory to the contract.
- Third party: anyone else. The other driver, the neighbour, the injured visitor.
So "first party" describes a position in a contract, not the size or seriousness of a loss. A £60 windscreen chip and a total house fire are both first party claims.
How does a first party claim work?
- Notification: the insured reports the loss, usually within a policy-stated window.
- Cover validation: policy in force, peril covered, no applicable exclusion, sums insured adequate.
- Assessment: scope and value the damage, in person, at a network repairer, or from submitted images.
- Application of the excess: the deductible or excess comes off the settlement.
- Payment: to the insured, or direct to a repairer or supplier on their behalf.
- Recovery: where someone else caused it, the insurer subrogates against that party in the insured's name.
The insurer's duty here is contractual and, in most jurisdictions, carries a good faith obligation on top: to handle promptly, to investigate fairly, and not to undervalue. That duty does not exist toward a third party claimant, which is the practical difference the rest of this page turns on.
How a first party claim differs from a third party claim
- Who claims: first party, the policyholder claims on their own policy. Third party, a stranger to the contract claims against the policy of whoever caused their loss.
- What has to be proved: first party, that a covered peril caused a covered loss. Third party, that the insured was legally liable, which is a fault question, not a cover question.
- Whose money: first party pays out under own-damage cover. Third party pays out under the liability section.
- Excess: applied on first party claims. A third party claimant does not pay the at-fault driver's excess.
- Duty owed: contractual and in good faith to the insured. To a third party claimant the insurer is an adversary defending its policyholder, within regulatory conduct rules.
- Speed: first party claims settle faster because there is one insurer, one customer and no liability argument to resolve first.
- Evidence access: the insurer can require its own insured to cooperate, produce documents and allow inspection. It has no equivalent hold over a third party claimant.
One loss usually generates both. A two-car collision produces a first party collision claim on each policy and a third party claim against whoever was at fault, and the same physical damage gets assessed twice by two organisations that do not share files.
First party claim example
A driver skids on ice and hits a wall. Nobody else is involved, so there is nobody to blame and no liability to argue. She notifies her insurer, the vehicle is inspected, the repair is scoped at $6,400, her $500 deductible comes off and the insurer settles $5,900 with the network repairer.
That size is unremarkable. Insurance Information Institute data puts the 2022 average collision claim at $5,992 and the average comprehensive claim at $2,738. Collision also runs at 4.20 claims per 100 insured vehicle years, so this is the volume end of motor claims, not the exceptional end.
Where first party claims stall
Rarely on cover. Almost always on information. The peril is usually obvious and the policy usually responds, so the delay sits in scoping the damage and proving the loss.
- Thin first submissions: three dark photos that miss the angle, the plate, the serial number or the surrounding context.
- Retake loops: every request for another image buys a customer response window, and customers reply on their own schedule.
- Proof of ownership and value: contents and specified-items claims stall on receipts and valuations more than on suspicion.
- Wrong routing: sending an assessor to a loss that images would have settled, or fast-tracking one that needed eyes on it.
Since a first party claimant is contractually obliged to cooperate, this is the side of the business where intake can be made to work properly. Structured capture at notification is covered in photo evidence in insurance claims, and the effect on elapsed days in claims cycle time.
Venta Capture, a product of VentaVid, is built for that intake step: the insured receives a link, is guided through exactly what to record, and the submission arrives as a structured, timestamped case a handler can assess without booking a visit or asking for a second round of photos.
