Subrogation is a fairly general concept, with a rather specific application in injury law. For our purposes, it occurs when an insurance company seeks repayment for money already disbursed to an injured insured from a source that otherwise would have gone to that same insured. It occurs when an insurance company tries to recover expenses it paid on a claim when someone else should have been responsible for paying (at least some) of that claim.
For example, imagine you were in a car accident with an unknown driver. The driver left the scene before you could gather any information and so you’re left holding the bag. You make a claim with your insurance company to cover your injuries and damages, and your insurance pays some of your claim. Later, your insurance company tracks down the man who hit you and, on your behalf, recovers some of the amount he owes you. If your insurance company is paid the amount they initially paid to you, that’s subrogation.
Subrogation is a controversial issue because of the made-whole rule. Until an injury victim has recovered damages sufficient to cover all his damages, his insurance company cannot seek subrogation. Like all things to do with the law, this is a complicated subject and the outcome depends heavily on your specific situation. If you have questions about subrogation and how it works, please call us today to discuss your case and learn more about your options.