If your home or business was damaged because of someone else, a contractor, a neighboring property owner, a driver, a delivery company, or another business, you may have a claim against the responsible party and its liability insurer.
These are commonly called third party property damage claims. Unlike a claim under your own homeowners or commercial property policy, a third party claim generally requires establishing who was responsible, determining whether insurance coverage is available, and proving the full amount of your loss, all before you ever see a settlement offer.
I am Jonathan Herrera, founder of Herrera PLLC. Before becoming an attorney, I spent over a decade handling claims on the insurance carrier side as a licensed Executive General Adjuster and claims counsel, investigating losses, evaluating liability and coverage, and negotiating claims. I know how these claims are evaluated from the other side of the table, and what it takes to build and present a claim that addresses liability, coverage, and damages from day one.
Common Scenarios We Handle
A Contractor Damaged Your Home
A roofer, plumber, foundation contractor, or general contractor caused water intrusion, structural damage, fire, or other damage while working at your property or a neighboring property. These claims can involve complicated questions about the contractor’s liability policy, exclusions, subcontractors, indemnity obligations, and whether the damage resulted from faulty workmanship or from resulting property damage; those are treated very differently by an insurer.
A Contractor Damaged Your Business
A roofer, HVAC crew, buildout contractor, or other construction professional caused water intrusion, structural damage, fire, or other damage to your commercial building while performing work on your property or a neighboring one.
These claims carry the same faulty workmanship and coverage exclusion issues as a residential contractor claim, but the damages side looks different for a business: lost inventory, damaged equipment, and lost income while the space is unusable are all part of the loss, not just the physical repair.
A Vehicle Damaged Your Home or Business
A driver left the roadway and struck your home, commercial building, fence, gate, or landscaping. Depending on the circumstances, the claim may involve a personal auto policy, a commercial auto policy, an employer, or another potentially responsible party.
A Neighbor Caused Damage to Your Property
A fire, plumbing failure, construction activity, roof issue, or drainage problem originating at a neighboring property caused damage to your home or business. Determining who is legally responsible and identifying available coverage are the critical first steps.
A Delivery Company or Other Business Damaged Your Property
A delivery vehicle, service provider, or another business operating near your property damaged a building, inventory, or equipment. Commercial liability and commercial auto policies can raise different coverage issues than a typical residential claim.
Should You File a Claim With Your Own Insurance?
Not necessarily, but you should not assume the other party’s insurance is your only option either.
If someone else caused damage to your property, you may have a claim against that party and its liability insurer. Depending on the circumstances, your own homeowners or commercial policy may also provide coverage, and your own insurer may be able to pay for covered damage while pursuing recovery from the responsible party through subrogation.
The right approach depends on the facts, the available policies, and the cause of the damage. Before deciding how to proceed, you need to understand every source of potential recovery, not just the obvious one.
Step One: Identify Who Is Responsible and Find the Insurance
Before we put a value on anything, we determine who is legally responsible and what insurance is actually available. That may involve identifying the property owner or tenant, a contractor or subcontractor, a driver or vehicle owner, a delivery company, a property manager, an employer, or a homeowners association.
We then look for every potentially applicable policy: homeowners liability, commercial general liability, commercial auto, personal auto, umbrella or excess coverage, and anything else that could respond to the loss.
This is also where you have to verify what type of policy exists and confirm it actually covers what happened. Many individuals and small contractors carry little or no liability insurance, and even less in personal or business assets to pursue directly.
Confirming coverage first tells us whether we are negotiating with an insurance company or chasing someone with no ability to pay, and that fact should shape the entire strategy from the beginning.
If the Other Insurance Company Denies the Claim
A liability carrier may dispute a property damage claim for several different reasons, and they are not the same problem:
- Liability. The insurer contends its insured did not cause the damage.
- Causation. The insurer agrees its insured was involved but disputes whether that conduct actually caused the damage claimed.
- Coverage. The insurer contends the policy does not apply to this type of loss.
- Exclusions. The policy contains language that limits or eliminates coverage for the specific damage.
- Scope of damage. The insurer accepts responsibility but disputes how much damage actually occurred.
- Amount of loss. The insurer disputes the reasonable cost of repair, replacement, or mitigation.
Every denial should be diagnosed as one or more of these, not treated as a single generic dispute, because the right response is different for each one.
Build the Full Scope of Damage Before You Ever Discuss a Number
This is the part of a third party claim that catches people off guard. Once a liability carrier accepts fault, it typically extends one settlement offer and negotiates it as a full and final lump sum. There is no partial payment while the rest of the claim is worked out, and once that number is agreed to, there is generally no coming back for more later. That makes the scope of damage work before the offer the most important part of the entire claim.
Depending on the facts, damages may include repair or replacement costs, hidden damage discovered only once demolition begins, mitigation expenses, code upgrade costs where legally recoverable, damage to inventory or equipment, loss of use, lost business income where recoverable, and diminished value to the property after repairs are complete. For significant losses, this often requires contractors, engineers, or other consultants to fully document the loss before it is ever priced.
Depreciation is also handled differently on a third party claim than it is on your own first party policy, and if it is not addressed correctly at the outset, you can be shorted on the true value of the loss without ever realizing it.
Preserve the Evidence Before Repairs Begin
Property damage changes quickly. Water dries. Materials are removed. Damaged components get discarded, and temporary repairs can conceal the original condition of the loss.
Before substantial repairs or demolition happen, it is important to preserve photographs and video, inspection reports, repair estimates and contractor proposals, invoices and receipts, damaged materials themselves where possible, contracts and work orders, communications with the contractor or property owner, incident reports, surveillance footage, and any expert reports documenting the property’s condition before and after the incident. This becomes critical when the other side later disputes what happened, what caused it, or how extensive it was.
Contractor Caused Damage Presents Unique Insurance Issues
Contractor claims deserve their own attention because a contractor’s liability policy does not automatically cover every problem tied to their work. A carrier may raise the faulty workmanship issue, the “your work” exclusion, questions about resulting property damage versus the cost of correcting defective work itself, subcontractor responsibility, additional insured status, or contractual indemnity obligations. The specific policy language and the facts of the loss have to be reviewed individually. You cannot assume a contractor’s insurance will simply pay for the whole claim.
What If There Is Not Enough Insurance?
Sometimes the responsible party has no insurance, insufficient limits, or a coverage dispute prevents the carrier from paying the full loss. When that happens, we evaluate every other available source of recovery: your own homeowners or commercial policy, other potentially responsible parties, additional or excess coverage, and any contractual obligations that might apply. The goal is to find every reasonably available avenue, not stop after the first insurer says no.
Why an Insurance Claims Background Matters
A property damage claim is a negotiation with a claims organization that evaluates liability, causation, coverage, documentation, and damages every day as a matter of routine. Going in without someone who has worked inside that process means negotiating blind.
I spent more than a decade on the insurance side of these exact claims: reviewing files, investigating losses, evaluating liability and coverage, and negotiating value. That experience means I know the questions an adjuster is likely to ask, the documentation a carrier will look for, the coverage issues that surface, and the ways a claim gets limited before the full extent of the damage is ever known.
Act Before You Sign Anything
Texas law generally gives you two years from the date of the incident to bring a negligence based property damage claim, but do not wait to get advice simply because a deadline is still out. Evidence disappears within days, not years, and a signed release can end your ability to recover for damage that has not even been discovered yet.
If a contractor, driver, neighbor, or another business damages your home or commercial property in Texas, do not accept the first position you are given. Before you resolve anything with an insurance company, know who is responsible, what coverage exists, whether your own policy applies, what exclusions or gaps exist, and the complete scope and cost of the damage.
Contact Herrera PLLC to discuss your claim before you settle it.
Frequently Asked Questions
It generally involves seeking compensation from the person or business responsible for damaging your property and, where applicable, that party's liability insurer, rather than filing under your own policy.
Not necessarily. Depending on the circumstances you may have a claim against the responsible party's insurer, your own homeowners policy, or potentially both.
We evaluate other potential sources of recovery, including your own coverage, other responsible parties, contractual obligations, or available assets.
It depends on whether the dispute concerns liability, causation, coverage, an exclusion, or the amount and scope of the damage claimed. Each requires a different response.
Generally no. Once a carrier accepts liability it typically extends one settlement offer as a full and final lump sum, which is why the complete scope of damage has to be established beforehand.
No. Depreciation is treated differently on a third party claim, and it takes experience on both sides of these claims to navigate it correctly.
Contractor caused damage can involve both liability and coverage issues, since the contractor's policy may exclude the very type of damage caused. The distinction between defective work and resulting damage to other property is often central to the analysis.
Before accepting anything, you should understand exactly what the settlement resolves and whether the full scope of your damage has been documented. A signed release can end your ability to pursue additional recovery later.