Subrogation is a concept that's well-known in legal and insurance circles but rarely by the policyholders who hire them. If this term has come up when dealing with your insurance agent or a legal proceeding, it would be in your benefit to comprehend the steps of the process. The more you know about it, the more likely an insurance lawsuit will work out in your favor.
An insurance policy you have is an assurance that, if something bad happens to you, the insurer of the policy will make good in one way or another in a timely manner. If your vehicle is in a fender-bender, insurance adjusters (and the courts, when necessary) decide who was at fault and that party's insurance covers the damages.
But since determining who is financially accountable for services or repairs is sometimes a heavily involved affair – and time spent waiting sometimes adds to the damage to the victim – insurance companies in many cases opt to pay up front and assign blame afterward. They then need a mechanism to get back the costs if, when all is said and done, they weren't actually in charge of the expense.
You are in a highway accident. Another car crashed into yours. The police show up to assess the situation, you exchange insurance details, and you go on your way. You have comprehensive insurance that pays for the repairs right away. Later police tell the insurance companies that the other driver was at fault and his insurance should have paid for the repair of your vehicle. How does your company get its funds back?
How Does Subrogation Work?
This is where subrogation comes in. It is the way that an insurance company uses to claim reimbursement after it has paid for something that should have been paid by some other entity. Some companies have in-house property damage lawyers and personal injury attorneys, or a department dedicated to subrogation; others contract with a law firm. Normally, only you can sue for damages done to your person or property. But under subrogation law, your insurance company is extended some of your rights in exchange for making good on the damages. It can go after the money originally due to you, because it has covered the amount already.
Why Does This Matter to Me?
For starters, if your insurance policy stipulated a deductible, your insurance company wasn't the only one that had to pay. In a $10,000 accident with a $1,000 deductible, you lost some money too – namely, $1,000. If your insurance company is lax about bringing subrogation cases to court, it might opt to recoup its expenses by upping your premiums and call it a day. On the other hand, if it knows which cases it is owed and pursues them enthusiastically, it is acting both in its own interests and in yours. If all is recovered, you will get your full $1,000 deductible back. If it recovers half (for instance, in a case where you are found one-half at fault), you'll typically get $500 back, based on the laws in most states.
Furthermore, if the total cost of an accident is more than your maximum coverage amount, you may have had to pay the difference, which can be extremely spendy. If your insurance company or its property damage lawyers, such as Lawyers for Car Accidents Marietta GA, pursue subrogation and succeeds, it will recover your expenses as well as its own.
All insurers are not the same. When shopping around, it's worth measuring the records of competing companies to determine if they pursue winnable subrogation claims; if they do so without dragging their feet; if they keep their clients updated as the case goes on; and if they then process successfully won reimbursements right away so that you can get your funding back and move on with your life. If, on the other hand, an insurer has a record of honoring claims that aren't its responsibility and then covering its bottom line by raising your premiums, even attractive rates won't outweigh the eventual headache.Lawyers for Car Accidents Marietta GA