Exactly.

You do not know what kind of encryption, how strong it is, or how well it will be supported in the future for software that comes with your flashdrive.

By "third party" software we are talking "Open Source" encryption software. The benefits are:

(1) Open source means you get the source code. You can even compile it yourself if you are so inclined. But this also means that you, and others, can review the source code and determine firsthand if there are hidden backdoors or vulnerabilitys. Not everyone is capable of examining the source code to this level, but many are and have done so.

(2) If a new OS version comes out and the manufacturer of your flashdrive doesn't update their software for it, open source allows you (or someone else) to modify/recompile the source code for that new platform. So your data is not encrypted and locked into an older OS due to some manufacturers proprietary encryption.

(3) Open source is free.