The Illusion of Insurance

Explaining insurance is kind of like explaining the English language. There are exceptions to every rule.

But basically third-party coverage is insurance for situations where the insured hurts someone else. And first-party coverage is for situations where the insured suffers a loss.

For example, liability coverage under an auto policy that pay for repairs damages if you back into someone's car is third-party and your homeowner's insurance covers the cost of repairing water damage if there's a broken pipe.

Most of our work involves collecting third-party coverage for our injured clients. But there's some first-party work too. We make sure they collect benefits under the PIP and also handle their UM/UIM claims.

Similarly, most of our work involves Auto policies. But there are situations where we sue property owners. That implicates their homeowners insurance.

So it caught my eye when I saw these statistics in the WSJ.

Can you imagine paying premiums year after year only to have your claim closed without payment?

Almost half of homeowners who make claims don't have to imagine it. They get to experience it.

And if the homeowners arms of those companies are getting away with denying claims how long will it be until the auto divisions will start doing the same thing?