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A third-party claim is a request for compensation from the insurer of the person or business that caused your injury. In Illinois, these claims often pay for medical treatment, lost wages, and vehicle repairs after someone else’s carelessness. Dealing with an insurer that owes you nothing by contract can feel unfair, especially while you are still in pain.
That frustration is common, and Illinois law offers more protection than many people realize. At Conboy Law, we help injured people in Chicago and across Illinois pursue third-party claims against drivers, property owners, contractors, and manufacturers. If you are weighing a third-party claim, call 312-726-9000 for a free case evaluation.
Your best move is calling us today.
What Is a Third-Party Claim?
A third-party claim is a claim made against someone else’s liability insurance because that person or business caused your harm. You are not that insurer’s customer. The company reviews your claim as an outsider, and its main duties run to the person it insures.
Who Is the Third Party in a Third-Party Claim?
Each person involved has a role:
- The policyholder: The driver, property owner, or business accused of causing the harm
- The insurer: The company that issued that party’s liability policy
- You: The injured person, who stands outside that insurance contract
People also call the at-fault person the third party, and both uses are common.
Common Examples of Third-Party Claims
Third-party claims can be made against any of the following:
- A driver’s auto liability policy after a rear-end crash
- A store’s insurer after a fall on an unmarked wet floor
- A manufacturer after a defective product causes injury
- A subcontractor whose crew created a hazard on a job site
First-Party Claim vs. Third-Party Claim: Key Differences
A first-party claim goes to your own insurer, while a third-party claim goes to the at-fault party’s insurer. The key differences include the following:
- Who owes you a duty: Your insurer owes you contract duties, but the other insurer answers mainly to its customer.
- Deductible: Your own collision claim usually carries a deductible, and a claim against the other driver’s insurer does not.
- Proof of fault: A third-party claim requires evidence that the other party was legally responsible.
- Available damages: Your own policy pays only what it covers, while a liability claim can include pain and suffering.
Is It Better to File a Third-Party Claim?
Often, the answer is both. Your own collision coverage may pay for repairs sooner, and your insurer can then seek repayment from the at-fault driver. If the other driver’s limits are too low, uninsured and underinsured motorist coverage on your own policy may cover part of the gap.
Illinois Rules That Protect You in a Third-Party Insurance Claim
Even without a contract, Illinois sets ground rules for insurers. The Illinois Department of Insurance guide to filing a claim with another driver’s insurer summarizes several of them:
- Minimum coverage: Under 625 ILCS 5/7-203, most drivers must carry $25,000 per person and $50,000 per accident for bodily injury, plus $20,000 for property damage.
- Claim forms: Section 154.6(o) of the Illinois Insurance Code identifies failure to provide necessary claim forms within 15 working days of a request as an improper claims practice.
- Delay explanations: Section 919.80 of the Illinois Administrative Code requires a written explanation when a property damage liability claim stays unresolved more than 60 days after it is reported.
- Rental cars: The same rule requires payment of documented rental costs, in proportion to liability, when liability is reasonably clear.
- Separate property damage payment: An insurer may not refuse an agreed property damage payment just because your injury claim remains open.
Fault still shapes every offer. Under 735 ILCS 5/2-1116, you can recover only if your share of fault is 50% or less, and your damages shrink by your percentage of fault.
What If the Insurer Denies or Undervalues Your Claim?
A denial or a low offer does not end your options. The Department of Insurance lists the following paths:
- Filing a claim under your own policy, if you carry the right coverage
- Filing a lawsuit against the at-fault driver, including in small claims court when the amount qualifies
- Getting help from an attorney
Only a judge or jury can make a final ruling on fault. Because bad faith rules usually protect policyholders against their own insurer, bad faith insurance claims work differently from third-party disputes.
How a Third-Party Claim Works in Illinois
Most third-party claims follow a similar path:
- Open the claim: Report the incident to the at-fault party’s insurer and get a claim number.
- Preserve evidence: Keep the police or incident report, photos, witness names, and repair estimates.
- Finish key medical treatment: Settling before your doctors understand your injuries can leave future costs uncovered.
- Send a demand package: Medical records, bills, and wage records support the amount you request.
- Expect a fault review: The adjuster assigns percentages of fault, and that number can reduce the offer.
- Negotiate: Offers often change as new evidence and medical records come in.
- Sign a release or file a lawsuit: A signed release ends the claim for good; a timely lawsuit is the alternative when talks stall.
How Long Does a Third-Party Claim Take?
No Illinois law sets a single timeline, and injury claims usually wait until treatment shows the full harm. If a property damage claim drags past 60 days, the insurer owes you a written reason for the delay.
Third-Party Claims After a Workplace Injury
Workers’ compensation is usually your only remedy against your employer, but it does not shield anyone else who caused the injury.
820 ILCS 305/5 of the Illinois Workers’ Compensation Act bars lawsuits for damages against the employer and its insurer. Subsection (b) still allows legal action against other negligent parties. Examples include a subcontractor, an equipment maker, or a driver who hit you during a work errand.
How Your Employer’s Lien Works
When you collect workers’ comp and also recover from a third party, Section 5(b) sets the following rules:
- Reimbursement: Your employer is repaid, from your recovery, the compensation it paid or will pay.
- Shared costs: Absent another agreement, the employer pays its share of costs and 25% of its gross reimbursement to your attorney.
- Notice: If you file a lawsuit, you must notify your employer by personal service or registered mail.
- Consent: A settlement or release requires written consent from both you and your employer, unless a court order fully protects the employer.
- Backup filing: If you have not filed by 3 months before the deadline expires, your employer may file in its own name or yours.
Who Gets Paid From a Third-Party Settlement?
Before you receive your share of a settlement, the following claims may need payment:
- Workers’ comp lien: Your employer’s reimbursement under Section 5(b), when comp benefits were paid
- Medical provider liens: Capped at 40% of the recovery for all provider liens combined, under 770 ILCS 23/10 of the Health Care Services Lien Act
- Attorney fees and costs: Paid under your fee agreement when a firm works on a contingency fee basis
Knowing these amounts helps you judge whether an offer covers your losses.
When Several Third Parties Share Fault
Some injuries involve more than one responsible party, such as two drivers or a driver and a road contractor.
Under 735 ILCS 5/2-1117, every liable defendant can be held responsible for your full past and future medical expenses. For other damages, a defendant found less than 25% at fault pays only its own share. If the injury happened at work, your employer’s fault is left out of that 25% calculation.
How Long Do You Have to File a Third-Party Claim in Illinois?
An insurance claim does not stop the legal clock. You must settle or file a lawsuit before the deadline that applies:
- Personal injury: 2 years after the cause of action accrues, under 735 ILCS 5/13-202
- Injured minors: 2 years from the child’s 18th birthday, according to Department of Insurance guidance
- Property damage: 5 years after the cause of action accrues, under 735 ILCS 5/13-205
- Local public entities: 1 year for most claims against a local government body or its employees, under 745 ILCS 10/8-101
Frequently Asked Questions About Third-Party Claims
No. Illinois insurance regulators confirm that you do not pay a deductible on a claim against another driver’s insurer. Deductibles apply only when you claim under your own policy.
Yes. Illinois law lets you collect workers’ compensation and pursue a separate claim against a negligent outside party. Your employer may then be reimbursed from that recovery.
Generally, no. When a third-party claim does not resolve, the lawsuit names the at-fault driver, and that driver’s insurer typically defends the case within the policy limits.
The policy limit caps what that insurer will usually pay, which is $25,000 per person for bodily injury at the Illinois minimum. Underinsured motorist coverage on your own policy, or another liable party, may help close the gap.
Get clarity, confidence, and powerful representation.
Talk to Conboy Law About Your Third-Party Claim
A third-party claim pits you against an insurer whose first loyalty belongs to someone else. Our team at Conboy Law gathers the evidence, tracks liens and deadlines, and negotiates with the at-fault party’s insurer so you can focus on healing.
Founding attorney Joseph M. Conboy and our Chicago team handle third-party claims involving crashes, workplace injuries, unsafe property, and defective products throughout Illinois. We work on a contingency fee basis from our office at 53 W Jackson Blvd, Suite 1152.
If you need a third-party claim lawyer in Chicago, call 312-726-9000 for a free case evaluation.
Joseph M. Conboy is the founding attorney of Conboy Law and represents victims and families in serious personal injury, medical malpractice, and wrongful death cases throughout Illinois. He has obtained numerous multi-million-dollar results and has been recognized by Super Lawyers as a Rising Star. As the firm’s primary litigator, he works closely with clients to build strategies tailored to the facts of each case.
