What is subrogation?

Subrogation is a legal right in Colorado under accident law. It allows an insurance company to pursue financial compensation from a third party when a policyholder’s property has suffered loss or damage. This right is given to the insurance company when the party who caused the damage has the financial ability to pay for it. Subrogation is used when an insurance company has already paid out on a claim to its policyholder, and then seeks to recoup the money it paid out from the negligent third party, usually by filing a lawsuit. This helps to prevent the policyholder from bearing the full financial burden of an accident or other loss. When an insurance company chooses to pursue subrogation, the policyholder must agree to allow the insurance company to pursue the case. The policyholder may be able to receive a portion of the recovered funds, after the insurance company takes out its expenses and covers the claim. Subrogation is designed to help insurance companies recoup some of their losses and to limit the amount of damages policyholders bear from costly claims. In some cases, pursuing subrogation can result in a fast resolution and swift payment to policyholders.

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What is subrogation?

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