How is a liability claim handled?

In North Carolina, a liability claim is handled by a process called subrogation. Subrogation is a legal process that allows an insurance company to seek payment for losses incurred by its policyholder from a third party who is legally responsible for those losses. For instance, if an insured driver is found to be at fault for an auto accident, the insurer may pursue a claim against the other driver’s insurer to recoup the money paid out to the policyholder. The insurance company must prove that the third party was legally liable for the losses and that the insured was not at fault. To do that, the insurer will collect evidence, such as witness statements, medical reports and police reports. The insurer will then review the evidence and make sure that it meets the legal criteria before filing a claim. Once the claim is filed, the insurance companies involved will negotiate a settlement. If a settlement cannot be reached, the injured party may file a lawsuit against the negligent party. In these cases, a court will decide who is liable for the losses and how much money the insurance company should receive in damages. If the court finds the insurer is legally entitled to recover the losses, it can issue a judgment ordering the other party to pay the amount.

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