What Is Subrogation?
Posted On behalf of Pfeifer Morgan & Stesiak on Aug 16, 2011 in Educational
Not every auto accident case makes it to court. Your insurance company pays out on your claim before the other driver’s does oftentimes.
When this happens, you must pay a deductible as well. The insurance company does not count this as a loss, however. Instead, the company begins immediately working on recovering the money that was paid out.
This is when subrogation begins.
Claims Against The Other Driver
In the state of Indiana, subrogation is when the insurance company proceeds to collect the cost of your claim from the other driver’s insurer. This sum includes the deductible you paid. Subrogation can be considered exercising reimbursement rights. Your insurance company contacts and negotiates with the other driver’s company until they reach a consensus on the claim.
Of course, insurance companies don’t always agree. Indiana Code 34-53-1 gives your insurance company that right to sue the other driver’s insurer for the cost of your claim. The company can also recover the cost of litigating the case, including performing depositions, hiring and transporting witnesses, attorney’s fees and other expenses. Once that case has concluded, you can recover the deductible that you paid on the claim.
Claims Against You
If you undertake a personal injury claim, you could be the focus of a subrogation case. The insurance company will ask you for reimbursement of the money paid toward your injuries, minus any deductible paid. This request will come after a settlement is reached or judgment handed down by the jury in your personal injury case on the accident.
If you do not pay, your own insurance company could sue you in order to recoup their costs.
Subrogation takes place in many other cases. Medical insurance companies can legally use subrogation to recoup their payments made to cover your injuries during an accident. Government medical insurance programs can use subrogation as well to recoup the costs of medical expenses incurred during an accident.
Subrogation is one more piece to the personal injury puzzle. Although it isn’t always a factor in a case, many plaintiffs find themselves surprised when facing a request by an insurer as a part of subrogation.
Simply put, it is a reimbursement request.
Consult your personal injury attorney for help with the request to ensure that your rights are protected.