Subrogation is a term that's well-known among legal and insurance professionals but sometimes not by the policyholders they represent. Even if you've never heard the word before, it is in your benefit to understand the steps of the process. The more knowledgeable you are about it, the more likely it is that relevant proceedings will work out in your favor.
Any insurance policy you own is a promise that, if something bad occurs, the company on the other end of the policy will make restitutions without unreasonable delay. If your vehicle is rear-ended, insurance adjusters (and police, when necessary) determine who was at fault and that party's insurance pays out.
But since figuring out who is financially accountable for services or repairs is sometimes a heavily involved affair – and time spent waiting often adds to the damage to the policyholder – insurance firms usually decide to pay up front and figure out the blame afterward. They then need a mechanism to regain the costs if, when all the facts are laid out, they weren't in charge of the payout.
You are in a vehicle accident. Another car collided with yours. Police are called, you exchange insurance details, and you go on your way. You have comprehensive insurance that pays for the repairs right away. Later police tell the insurance companies that the other driver was entirely at fault and his insurance should have paid for the repair of your auto. How does your insurance company get its funds back?
How Does Subrogation Work?
This is where subrogation comes in. It is the way that an insurance company uses to claim payment after it has paid for something that should have been paid by some other entity. Some companies have in-house property damage lawyers and personal injury attorneys, or a department dedicated to subrogation; others contract with a law firm. Usually, only you can sue for damages done to your person or property. But under subrogation law, your insurer is given some of your rights in exchange for making good on 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 one thing, if your insurance policy stipulated a deductible, it wasn't just your insurer 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 insurance company is unconcerned with pursuing subrogation even when it is entitled, it might choose to recoup 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 acting both in its own interests and in yours. If all ten grand is recovered, you will get your full thousand-dollar deductible back. If it recovers half (for instance, in a case where you are found one-half at fault), you'll typically get half your deductible back, depending on your state laws.
Furthermore, if the total price 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 Car Accidents Mableton GA, successfully press a subrogation case, it will recover your losses in addition to its own.
All insurance agencies are not the same. When comparing, it's worth weighing the reputations of competing agencies to find out whether they pursue legitimate subrogation claims; if they do so fast; if they keep their accountholders apprised as the case proceeds; and if they then process successfully won reimbursements immediately so that you can get your money back and move on with your life. If, on the other hand, an insurance agency has a reputation of paying out claims that aren't its responsibility and then protecting its income by raising your premiums, you'll feel the sting later.Attorney for Car Accidents Mableton GA