Subrogation is a complex insurance concept that comes into play when your insurance company has a claim against you for an injury or accident for which it paid out on your behalf. Subrogation can also happen when someone else files an insurance claim against you, and the insurer pays out on that claim. Subrogation is a complicated subject, but its primary goal is to ensure that all parties are paying what they are supposed to pay and that the people who need help are getting that help. Subrogation states the insurer’s right to recoup a portion of their policy limits paid on behalf of an insured person. One should expect certain things once an insurer is subrogated in a claim. Here are some things to expect when your insurance claim involves subrogation.
1. Contact Your Insurance Company As Soon as Possible
If an insurance company needs to reimburse itself for the costs of a claim, it is called subrogation. This can happen at any point during the claims process, not just after the claim is settled. For example, in fire claims, a subro representative may be involved from the beginning. That’s why it’s important to share information about the claim as soon as possible; this helps the insurance company determine if a subro rep is needed.
2. When the At-Fault Driver Has Insurance
The process is generally more straightforward if your claim involves an at-fault driver with insurance. Generally, your insurance company will claim the at-fault driver’s insurance company. The insurance companies will then figure out how much of the policy limit was used on behalf of your claim. When an insurer’s policy limits are similar to those of the injured person’s policy, the process can move faster and more efficiently because it doesn’t require negotiation between two insurance companies. However, suppose one of the insurer’s policy limits is significantly lower than another insurer’s policy limits. In that case, negotiation might be necessary, which could add time to both sides of the claim. If you were injured in an accident where the at-fault driver has insurance, the insurer who covers that driver would most likely initiate a subrogation claim.
3. When the At-Fault Driver Does Not Have Insurance
If the at-fault driver does not have insurance, your insurer will usually initiate a subrogation claim against that person’s assets. If they have any money in savings or support, this is where the insurers will go to recoup losses. However, if someone doesn’t have any assets or savings, there might not be anything the insurance company can do. This can be discouraging for both sides of the claim. The insurer will want to be reimbursed for its losses, and the injured person would like to be compensated for medical bills. This is a common problem when you are involved in an accident with an uninsured driver because they don’t have any assets to go after.
When an insurance company is subrogated in a claim, the injured party should understand this and how it will affect their claim. They will make sure their policy limits are used appropriately and that the injured party receives full payment for medical expenses and other losses due to the accident. Insurance companies are covered by state and federal laws regulating their use of subrogation, so you can have confidence in your insurer to make fair and correct decisions for both sides of the claim.