Subrogation is a concept that's understood in legal and insurance circles but rarely by the customers who employ them. Even if it sounds complicated, it is in your self-interest to understand an overview of how it works. The more you know, the better decisions you can make about your insurance policy.
An insurance policy you hold is a commitment that, if something bad happens to you, the insurer of the policy will make restitutions in one way or another in a timely fashion. If you get injured while you're on the clock, for instance, your employer's workers compensation insurance pays out for medical services. Employment lawyers handle the details; you just get fixed up.
But since ascertaining who is financially responsible for services or repairs is regularly a time-consuming affair – and time spent waiting sometimes compounds the damage to the policyholder – insurance companies in many cases decide to pay up front and assign blame later. They then need a way to regain the costs if, once the situation is fully assessed, they weren't actually responsible for the expense.
Can You Give an Example?
You go to the emergency room with a sliced-open finger. You give the receptionist your health insurance card and he records your policy information. You get stitches and your insurance company gets a bill for the services. But the next morning, when you get to your workplace – where the injury occurred – you are given workers compensation paperwork to turn in. Your workers comp policy is actually responsible for the bill, not your health 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 way that an insurance company uses to claim reimbursement 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. Ordinarily, only you can sue for damages done to your self or property. But under subrogation law, your insurance company is extended some of your rights in exchange for having taken care of the damages. It can go after the money that was originally due to you, because it has covered the amount already.
Why Should I Care?
For starters, if you have 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 – to be precise, $1,000. If your insurer is timid on any subrogation case it might not win, it might choose to get back its costs by ballooning your premiums and call it a day. On the other hand, if it knows which cases it is owed and goes after those cases enthusiastically, it is doing you a favor as well as itself. If all 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 $500 back, depending on the laws in your state.
Additionally, if the total loss 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 Attorney for Truck Accidents Smyrna GA, successfully press a subrogation case, it will recover your expenses in addition to its own.
All insurance companies are not created equal. When shopping around, it's worth comparing the reputations of competing agencies to find out whether they pursue winnable subrogation claims; if they resolve those claims without dragging their feet; if they keep their policyholders informed 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, instead, an insurer has a reputation of paying out claims that aren't its responsibility and then safeguarding its bottom line by raising your premiums, you should keep looking.Attorney for Truck Accidents Smyrna GA