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| Subrogation |  Imagine you’re in a car accident and it is clearly not your fault. Your vehicle is wrecked and your neck and back have been injured. Suppose you are covered for both the damage to your car and your personal injuries, and so you call your insurance company and they pay all of your expenses relating to the accident. After that, your insurance company, realizing that the other party at fault also has insurance that will cover the damages, seeks out reimbursement from that insurance company since its insured was actually at fault for the accident. It is subrogation.
This term refers to an insurance company seeking reimbursement from the person or entity legally responsible for an accident after the insurer has paid out money on behalf of its insured. The general principle is that, after paying your claim, your insurer is “subrogated” to the rights of your policy and can “step into your shoes” to go after or sue the negligent party on your behalf. However, not all insurers subrogate for medical bills. If insurers do, it could be against the other driver’s insurance, but it could also be against your own separate health insurance policy or any other medical insurance that would cover your treatment.
Subrogation may also be used when your insurer settles your collision claim for damage to your vehicle due to another driver’s negligence. In fact, your insurer will have you sign a subrogation release that assigns your right of recovery against the person responsible for your loss to them. Insurance providers may not stall settling your claim until they get paid from the person at fault. Usually subrogation occurs some time after the original claim is settled. Some insurance providers will include the deductible when they subrogate and you will get your deductible back when the other driver or their insurance company pays the subrogation claim.
What if the accident was your fault?
In case the accident was your fault, you are responsible for the damages caused. But if the accident was only partly your fault, you may be only responsible for a portion of the damages depending on the laws of your state. The other driver’s insurer will likely subrogate against you or your insurance company to pay for the damage to their insured’s car and/or their medical bills. Remember that often you can negotiate the amount of damages that is being claimed and pay out the amount over time. When you don’t have insurance and a claim is being subrogated against you, it is a good idea to contact a car accident lawyer to make sure you are not getting taken.
Be patient, but keep on top of your claim.
It is a good idea to cooperate with your insurer, within reason of course, when a subrogation claim has been made. Often, the two insurance companies are going back and forth to verify what happened and what amounts have been paid out. But this takes time – sometimes too much time. You have to be patient, but keep in close contact with your claims person so your claim doesn’t get pushed to the bottom of the pile.
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Subrogation