Subrogation and your auto insurance claim

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Subrogation in property/casualty insurance refers to when an insurance company pays one of its insured for damages, then makes its own claim against the other party or parties who may have caused the loss, or contributed to it. Subrogation is a way for your insurance company to recover money it has paid out to you. According to, “if you have a claim with your car insurance company, understanding what subrogation is and how insurance companies use it to recover some of their costs is important.”


What happens when another driver runs a red light, and your car is totaled in the resulting crash? According to Amis Insurance, “Your insurance carrier … pays you for all of your expenses related to the accident, then seeks reimbursement from the at-fault party’s insurance carrier. Your insurer is ‘subrogated’ to the rights of your policy and can ‘step in your shoes’ to recover any amount paid out on your behalf.” This is subrogation.


By now, you’re thinking “I need to be careful about my dealings with my insurance company. What if this crash affects my good standing and my coverage? I need a lawyer to handle this claim for me.” You are right: your attorney will be key in negotiating any settlement. Some insurers try to get you to agree to waive subrogation as part of your agreement. If you sign an agreement preventing subrogation without understanding what it means, your insurance company might refuse your claim, because it will be unable to get reimbursed by the other driver’s insurance.


Subrogation comes into the picture when an investigation has to be conducted to determine which party to the crash is responsible, and whose insurance company will pay. You may not be able to wait for your payout, in which case your insurer will pay you before fault is fully determined. The risk is that if you are found partly responsible for causing the crash, the amount you can receive will be prorated according to how much fault is yours, by percentage.


The law requires that your insurance company advise you when it is going to seek subrogation, and it also has to try to recover the deductible you needed to pay, and refund the amount of the deductible, again prorated by percentage of your responsibility for the collision. “If an insurance company does decide to pursue subrogation, however, the law requires that they inform you that they are doing it,” says “… Generally, your insurance policy will require you to cooperate with any attempts by the insurer to pursue subrogation. …This means you may not be allowed to sign any waivers or agreements that release the other driver from responsibility if the other driver is judged to be at fault in the accident.”


Richard Manger, principal of Manger Law Firm, has extensive experience in litigation and settlements, with a focus on personal injury and workers’ compensation law. We are proud of the strong relationships of loyalty and trust we develop with our clients. We go above and beyond to achieve the best possible outcome in your case. You can contact Richard Manger via email at, or by calling (336) 882-2000.

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