We often hear this term when making a claim for an accident we did not cause. Find out more about car insurance subrogation and how it works. Also, get free online quotes for car insurance from our website.
If they have applicable coverage, drivers can use their own auto insurance coverage to pay for vehicle damages that were caused by another motorist. But if the accident was not the fault of the policyholder, the car insurance company may attempt to recover the money paid on a claim from the responsible party’s insurer. This process is called subrogation.
When an insurer pays out on a claim that was not the fault of its policyholder, it will go after the responsible party to recover the money that was paid for the loss. This will usually happen when a policyholder files a claim with their own auto insurer instead of waiting for the other party’s carrier to take action.
Typically, insurers have a whole department responsible for handling subrogation. After the case is passed to them, this department will then try and contact the responsible party for repayment of funds paid towards its customer’s claim.
Recovering the money can be as easy as contacting the other carrier and arranging for payment, but it could become more difficult if the driver responsible for the crash did not carry a car insurance policy at the time of the accident. The motorist may not have the resources to pay for the damages, and, if the policyholder agrees, the claim will go to court, and a lawsuit will be filed to attempt to recover payment.
With insurers being able to subrogate for repayment of funds, it gives policyholders the choice to use their own carriers to pay for damages and get their cars repaired quicker.
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