Third Party Administrator — Insurance Claims Definition
Industry
A company that handles claims processing and benefits administration on behalf of insurers or self-insured employers.
TPAs administer workers comp, health, liability, or warranty programs under contract. They are not the insurer but follow carrier or employer protocols and delegated authority.
Examples
A self-insured corporation uses a TPA to adjust its liability retentions and pay third party claims within guidelines.
Common Mistakes
Insureds confuse TPA with insurer — legal responsibility remains with the policy issuer or self-insured entity.
