Subrogation is a term that's well-known among legal and insurance professionals but sometimes not by the customers who employ them. Rather than leave it to the professionals, it would be to your advantage to comprehend the steps of the process. The more knowledgeable you are about it, the more likely it is that an insurance lawsuit will work out favorably.
Every insurance policy you have is an assurance that, if something bad happens to you, the firm on the other end of the policy will make restitutions in one way or another without unreasonable delay. If you get an injury while working, for instance, your company's workers compensation pays out for medical services. Employment lawyers handle the details; you just get fixed up.
But since determining who is financially responsible for services or repairs is typically a time-consuming affair – and delay sometimes increases the damage to the victim – insurance firms usually opt to pay up front and figure out the blame later. They then need a way to recoup the costs if, in the end, they weren't actually in charge of the payout.
You go to the emergency room with a sliced-open finger. You give the receptionist your medical insurance card and he records your plan information. You get stitched up and your insurer gets a bill for the expenses. But the next morning, when you arrive at your place of employment – where the accident happened – you are given workers compensation paperwork to turn in. Your company's workers comp policy is actually responsible for the costs, not your medical insurance. It has a vested interest in getting that money back in some way.
How Subrogation Works
This is where subrogation comes in. It is the process that an insurance company uses to claim payment when it pays out a claim that turned out not to be its responsibility. Some insurance firms have in-house property damage lawyers and personal injury attorneys, or a department dedicated to subrogation; others contract with a law firm. Under ordinary circumstances, only you can sue for damages done to your self or property. But under subrogation law, your insurer is extended some of your rights for making good on the damages. It can go after the money originally due to you, because it has covered the amount already.
Why Do I Need to Know This?
For starters, if you have a deductible, it wasn't just your insurer who had to pay. In a $10,000 accident with a $1,000 deductible, you lost some money too – to the tune of $1,000. If your insurer is lax about bringing subrogation cases to court, it might opt to get back its losses by raising your premiums and call it a day. On the other hand, if it has a proficient legal team and pursues those cases efficiently, it is doing you a favor as well as itself. If all of the money is recovered, you will get your full deductible back. If it recovers half (for instance, in a case where you are found 50 percent culpable), you'll typically get half your deductible back, depending on the laws in your state.
Furthermore, if the total price of an accident is more than your maximum coverage amount, you could be in for a stiff bill. If your insurance company or its property damage lawyers, such as Criminal defense taylorsville ut, successfully press a subrogation case, it will recover your losses as well as its own.
All insurance agencies are not created equal. When shopping around, it's worth looking up the records of competing firms to evaluate whether they pursue winnable subrogation claims; if they resolve those claims with some expediency; if they keep their accountholders updated as the case proceeds; and if they then process successfully won reimbursements immediately so that you can get your deductible back and move on with your life. If, on the other hand, an insurer has a record of paying out claims that aren't its responsibility and then covering its income by raising your premiums, you should keep looking.