Insurance Paid Up? Your Insurer Might Step In (Subrogation Explained)
You file a claim, your insurance company pays out – happy days, right? But there’s a twist: subrogation. This legal principle allows your insurer to step into your shoes after a payout. Let’s see how it works:
- Example: Your car gets damaged in an accident caused by another driver. Your insurer pays for repairs.
Through subrogation, your insurer gains the right to pursue the at-fault driver to recover the repair costs they paid you.
This principle serves two key benefits:
- Prevents Double Recovery: You won’t get compensated twice for the same loss (from the insurer and the at-fault party).
- Keeps Premiums Affordable: By recouping costs from liable parties, insurers can potentially lower premiums for everyone.
In essence, subrogation ensures fairness and helps maintain a healthy insurance ecosystem.
Created by iax, Enhanced by AI
Proudly powered by WordPress