What is an insurance subrogation?

Insurance subrogation is a legal process which allows an insurance company to collect money from a third party for a claim that was paid out by the insurance company. In other words, an insurance subrogation occurs when an insurance company seeks to collect a claim payment from another party that is legally responsible for the claim. For example, if a car accident is caused by another driver and the injured party’s insurance company pays out a claim, the insurance company may pursue the other driver for reimbursement through the subrogation process. In California, if a claim is paid out by an insurance company, they are allowed to sue the party responsible for the damage or loss incurred. The insurance company may not, however, sue the insured party or engineer a settlement without first obtaining their consent. Insurance subrogation is a useful tool for insurance companies as it allows them to recoup funds that have been paid out for claims in cases where the other party is found to be legally liable. It also reduces the financial burden of a claim on the insured party, allowing them to receive compensation for their losses without having to pay for it out of pocket.

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What is an insurance subrogation?

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