Third-Party Insurance


DEFINITION of 'Third-Party Insurance'

An insurance policy purchased for protection against the actions of another party. Third-party insurance is purchased by the insured (first party) from an insurance company (second party) for protection against another party's claims (third party).

BREAKING DOWN 'Third-Party Insurance'

Third-party automobile insurance is one of the more popular types of third-party insurance. Drivers are often required by their state to have adequate insurance coverage to ensure that damages resulting from an accident can be paid for. "Third-party" in the case of automotive insurance would be the driver of the other vehicle, since that person is not the first party (principal) in the insurance policy.

  1. Third Party

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  2. Third-Party Claims Administrator

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  3. Auto Insurance

    A policy purchased by vehicle owners to mitigate costs associated ...
  4. Insurance Claim

    A formal request to an insurance company asking for a payment ...
  5. Insurance

    A contract (policy) in which an individual or entity receives ...
  6. Indemnity

    Indemnity is compensation for damages or loss. Indemnity in the ...
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