What is Subrogation?
The right of an insurance company to pursue a third party who caused the loss to recover the amount paid on a claim.
Understanding Subrogation
After paying a claim, insurers can "step into the shoes" of the insured to recover from the at-fault party. For example, after paying for car repairs, your insurer may sue the other driver. Subrogation can affect personal injury settlements as insurers may claim part of the recovery.
Examples
- 1Health insurer seeking reimbursement from car accident settlement
- 2Auto insurer suing at-fault driver after paying collision claim
- 3Workers' comp carrier recovering from negligent third party
Related Terms
Lien
A legal claim against a settlement or judgment that must be paid before the injured party receives their money, typically held by medical providers or insurers.
Medical Lien
A legal claim that gives a healthcare provider the right to be repaid from a personal injury settlement or verdict for treatment they provided to an injured patient. The provider treats the patient now and gets paid later when the case resolves.
Third-Party Claim
An insurance claim filed against another person's or entity's insurance policy seeking compensation for damages they caused.
Uninsured Motorist Coverage
Insurance coverage that protects you if you're injured by a driver who has no liability insurance or insufficient coverage to pay for your damages.
No-Fault Insurance
An auto insurance system where each driver's own insurance pays for their medical expenses and lost wages regardless of who caused the accident.
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