Subrogation is a term that you may find in your auto insurance policies. Will it protect you against financial losses? What is the critical significance of having a subrogation insurance claim? You can find answers to all of your questions in this guide.
It is common to submit an insurance claim after an accident to recover compensation for the injuries you suffered. In fact, most claims for compensation after an accident are settled outside of the courtroom. Dealing with an insurance agency can be challenging, and subrogation can affect your settlement and claim.
By the end of this article, you should be able to understand how subrogation can affect your claim. Read more to learn about claims involving subrogation and how they work.
What is subrogation?
Subrogation is a legal right that insurance companies hold to pursue a third-party claim. It is often beneficial for insurance agencies when third parties are responsible for an accident and share the total liability.
For instance, in some states, a plaintiff is required by law to first turn to their insurance company for compensation regardless of who caused the accident.
However, with subrogation, insurance companies may have the right to sue the third party to recover compensation. When you are not responsible for the accident, it can help them recover the damages. The companies cannot file a subrogation claim without informing the victim. They are required to inform them before proceeding and filing a claim.
How do subrogation claims work?
Many claimants become nervous when insurance companies decide to file a subrogation claim. Most of them are worried that the insurance agency’s actions could negatively affect them. However, one should note that it is generally not the reality.
The claims process should be completely transparent, and the insurance company. In addition, the insurance company’s subrogation claim should not affect the compensation that you receive as a victim.
With the subrogation claim, you would receive your claim as well as the deductible claim. You can ask your insurance agency to provide a complete record and statement of the settlements. You have the legal right to step in and ask for this documentation.
Subrogation can increase your chances of receiving a fair settlement in many instances. It is advised that you should stay in touch with your insurance company and agents to keep informed about the settlement and claim.
In some cases, subrogation can help you recover compensation for your damages and medical bills. If you are a motorcyclist, it is important to make sure you have appropriate motorcycle insurance coverage before going out on the road.
Why do insurance companies file subrogation claims?
As mentioned above, filing a subrogation claim can benefit the insurance companies when you do not share in the fault. There are various other situations in which it may be beneficial for insurance companies to pursue a subrogation claim.
The insurance carrier has to inform you if they plan to seek reimbursement via subrogation. You may have the legal right to sue the insurance company if you have not been informed of its decision.
At times, insurance companies do not inform their clients when they are filing subrogation. If this happens, you can consider taking legal action.
Does subrogation prevent double recovery?
It is important to know that subrogation prevents double recovery. Therefore, you would not be able to recover the same compensation twice via different methods. For instance, the subrogation claim will ensure that you do not recover compensation for medical bills twice. It will not cover compensation that has already been covered in another insurance policy.
How may subrogation affect your claim?
Subrogation prevents double recovery and may have an impact on your claim.
For example, if you succeed in a personal injury insurance claim or lawsuit, you may have to share the settlement or award with your insurance company. However, it would entirely depend on whether it was subrogated.
With a subrogation claim, the insurance company would receive benefits directly from the third party, and you would not have to share anything that you receive.
It can be helpful to keep in mind that your benefits can exclude the medical and other expenses that have been already covered through other means. If you have any questions, you can ask your insurance company directly.
Otherwise, you can consult a Philadelphia motorcycle accident lawyer who can help you understand the entire process. Your attorney can help you navigate the process seamlessly.