Subrogation

Subrogation The basic idea behind subrogation is that insurers have a right to receive payment for bills that they have paid on behalf of their insureds. The principle of subrogation states that once the insurance company has compensated the insured for the losses incurred by him/her, the ownership of the property is transferred to the insurance company. Subrogation allows the insurer to claim the amount of loss from the third party who is responsible for the loss. For instance, take a scenario of a road accident where two parties are involved, one of them being the insured. The cause of the accident is the reckless driving of one party. In this case, the insurer will provide the insurance claim amount to the insured as well as sue the third party carrier that caused the accident. The importance of this doctrine is that it allows your insurer to recoup costs, including your deductible, from the at-fault third party insurance company, if the accident was not your fault. A successful subrogation means a refund for you and your insurer. Subrogation is most common in an auto insurance policy but also occurs in property/casualty and healthcare policy claims. A waiver can be applied to subrogation which is an agreement that prevents your insurance company from acting on your behalf to recoup expenses from the at-fault party. A waiver of subrogation comes into play when the at-fault driver wants to settle the accident but with your insurer out of the picture. Make sure you fully understand this type of waiver before you sign. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful