What is the direct cost of a loss?

Direct costs can usually be placed into two categories: third party loss and first party loss.

In our example, third party losses would be incurred by people other than you.

First party losses refer to your losses and would include damage to your vehicle and towing expenses.

Third party and first party losses will vary depending on the particular accident. It is important to keep in mind, however, that future medical expenses, including a lifetime of care for the injury, could be claimed. This is particularly true in cases of serious or severe injuries.

While direct costs can, and often do, add up and must be considered, we must look beyond these figures to evaluate the REAL cost of the accident.