October 29, 2010 (Press-News.org) Though subrogation is a common term and practice within the insurance industry, it can seem dense and even rather daunting to everyone else. If you are dealing with an insurance company, however, it is important to know what subrogation is and how it works.
Subrogation is not unique to the world of insurance policies. The term "subrogation" refers to the procedure by which a party pays another's debt or other obligation, then seeks to assert the legal rights of the party who has been paid in order to recover that money from someone else (a third party) who is responsible for the debt. In other words, B pays C's debt to A, and B then seeks to recover the money from C.
The paying party does not have to be an insurance company; a creditor, guarantor or surety could also be a payor. Subrogation allows this payor -- often called a "collateral source" -- to step into the shoes of the party they have compensated and pursue the money to be made whole.
In cases involving insurance, the collateral source will often be a private insurer. But a government agency, such as a workers' compensation fund, can also play this role and be in the position of pursuing repayment. With private insurance, subrogation rights may be written right into the contract, although state statutes sometimes prohibit subrogation with certain types of insurance -- particularly life insurance. In other cases, a statute may establish the right of a government agency to use subrogation to recover damages from liable parties.
Toyota Recall Cases
Let's use a current example to illustrate how insurance subrogation works. Toyota has recalled over 8 million vehicles because of concerns about sudden acceleration caused by problems with removable floor mats and sticky gas pedals. The U.S. government fined Toyota $16.4 million for failing to disclose important safety information about these problems.
What happens when auto insurance carriers pay out on claims arising from injuries involving Toyota vehicles that were subject to recalls? These companies act as "collateral sources" in paying for accidents that were apparently caused by their policy holders. Can the insurance companies proceed against Toyota for full or partial reimbursement of those payments, if the claims arose from injuries caused by product defects in Toyota's manufacturing?
Legally and factually, the answer seems to be yes. The auto insurers are reviewing their legal options for pursuing subrogation actions against Toyota for claims they have paid out on in cases involving the acceleration problems that prompted the recalls. The large auto insurers may be combining their most serious claims against Toyota, and a mediation firm may help negotiate the amount of the reimbursement from Toyota to the auto insurers.
Individual Auto Insurance Claims
Subrogation does not only affect large, high-profile cases like the Toyota recalls. It can be involved in any type of claim involving an insurance company. With over seven million traffic accidents in the United States every year, however, auto insurance is a common way in which subrogation issues arise.
Consider, for example, these possible scenarios:
- You have adequate insurance and are involved in an accident that was the other driver's fault. Your insurance company compensates you, and then pursues recovery from the other driver or the other driver's insurance company through subrogation.
- You are involved in an accident that was your fault, but you didn't have insurance or enough insurance. The other driver uses his or her uninsured motorist coverage. The insurance company for the other driver then turns around and pursues recovery from you through subrogation for the money the company paid out to the policyholder.
- You are involved in an accident that was your fault, but you do have sufficient insurance. The insurance company for the other driver compensates its insured, but then seeks to recover from your insurance company through subrogation.
In the first scenario, your insurer may or may not seek to recover your deductible amount for you from the other driver's insurance company.
In the second scenario, if bodily injury was involved, you could be contacted by the subrogation department of the other driver's insurer. It is important to take these contacts seriously, and you may want to talk to a lawyer who knows your state's subrogation law.
Workers' Compensation
In addition to auto insurance claims, subrogation issues also commonly occur in workers' compensation cases. An employee injured at work is usually compensated through workers' compensation insurance. But what if a third party, such as a contractor on a construction site, was responsible for causing the work injury? In that case, the employee or the workers' compensation insurer may choose to pursue an action against the third party.
State statutes often set forth the specific rights that the employer and the employee have when pursuing recovery from a third party. In Idaho, for example, a statute provides that after the employer pays out workers' compensation benefits to an injured employee, the employer can then seek recovery through a subrogation action against any third party responsible for the injury. And if the employee recovers from the third party directly, the employer has the right to be reimbursed for the amount it already paid out.
Conclusion
Subrogation does not have to be an off-putting term, but it does sometimes raise difficult issues. One of these is how subrogation rights affect the settlement of third party lawsuits, such as those by an auto insurer against the party responsible for an accident. State laws vary on how that circumstance is handled. With these and other legal issues of concern, it is best to consult with a personal injury attorney in your area.
Article provided by Carty Law, P.A.
Visit us at www.cartylaw.net
Subrogation in Auto Insurance and Workers' Compensation Cases
Subrogation is the procedure by which a party pays another's debt and then seeks to assert the legal rights of the party who has been paid in order to recover that money.
2010-10-29
ELSE PRESS RELEASES FROM THIS DATE:
Insurance Coverage Requirement Change in Wisconsin
2010-10-29
The Wisconsin Legislature made significant changes to insurance coverage for automobiles last year that became effective this year. According to the Wisconsin Insurance Commissioner, effective June 1, no one may operate a motor vehicle in Wisconsin unless the owner or operator has a motor vehicle liability policy in place covering that vehicle that has minimum liability limits of $50,000 per person and $100,000 per accident for bodily injury and $15,000 for property damage.
Because coverage is now mandatory, drivers are also required to have proof of the vehicle's liability ...
Weight Discrimination Case Involving Hooters' Waitresses Allowed
2010-10-29
A Michigan judge is allowing two former Hooters waitresses to continue their weight discrimination cases against the restaurant chain. The women allege Hooters fired them for not being thin enough.
Michigan's Elliot-Larsen Civil Rights Act prohibits discrimination based on weight or height. Section 37.2202(1)(a) states that "(an) employer shall not ... (f)ail or refuse to hire, or recruit, or discharge or otherwise discriminate against an individual with respect to employment, compensation, or a term, condition, or privilege of employment, because of religion, race, ...
The FMCSA's New Trucking Safety Enforcement Program
2010-10-29
In an attempt to shore up its enforcement of federal trucking safety regulations, the Federal Motor Carrier Safety Administration (FMCSA) began rolling out a new program this year, the Comprehensive Safety Analysis, or CSA 2010.
The centerpiece of this program is a new electronic database that will allow FMCSA investigators to more efficiently and effectively pinpoint which commercial carriers and drivers are not complying with federal trucking safety government regulations.
Called the "safety measurement system" (SMS), the database uses information collected from ...
Leading Simpsonville Hotel Selects Hi/Lo Kennels as a Recommended Boarding Service for Guests Traveling with a Pet
2010-10-29
Holiday Inn Express Simpsonville Hotel announces the selection of Hi/Lo Kennels as a recommended boarding service for guests traveling with a dog or cat. Located only a short drive from the hotel, Hi/Lo Kennels is a family owned facility situated on 6 acres of land. They provide safe and comfortable accommodations for pets. Features include:
- Caring staff
- Individual indoor/outdoor covered runs
- Large exercise areas for private pet playtimes
- Meals prepared as you do at home
- Clean and pest free environment
- Mason fencing, doors, and beds
- Climate controlled ...
Superior Atlanta Airport Hotel Near Georgia Tech Football Games Offers Convenient Accommodations to Fans
2010-10-29
The Hilton Garden Inn Atlanta Airport Hotel North offers convenient lodging to guests attending Georgia Tech football games. Home games are played in Bobby Dodd Stadium at Historic Grant Field, in downtown Atlanta. The Yellow Jackets' two remaining home games are against tough Atlantic Coast Conference opponents Miami, on November 13, and Duke, on November 20.
"We are pleased to offer accommodations to alumni and fans visiting Atlanta this fall for Georgia Tech football games," explains Debbie Wells, the Atlanta Airport hotel's Director of Sales. Wells continues on to ...
Debenhams Launches its First Ever Interactive TV Channel
2010-10-29
Debenhams has announced the launch of its first ever interactive TV channel, Debenhams TV which it expects will become the destination for shoppers and online browsers looking for easy-to-digest, friendly style and shopping advice and purchases.
The new station is expected to win an estimated 1.5 million views in its first week, making it one of the most watched channels in the UK virtually overnight, giving Adrian Chiles and Christine Bleakley a run for their money.
The channel will provide a fresh alternative to the traditional 'browse and buy' online shopping ...
Kate Moss Launches Her Final Mainline Collection for Topshop this Autumn/Winter 2010
2010-10-29
Kate Moss launches her final mainline collection for Topshop this Autumn/Winter 2010, featuring '70s inspired pieces, capturing Kate's unique take on vintage bohemian dressing, launching in November.
Beautiful floral printed day dresses are Biba-esque; delicate chiffons and cottons are decorated with daisy and star prints and sleeves are bell-shaped. Cross stitch panels, embroidered flowers and fringing feature on shift dresses creating a hand-made feel. The tea-dress makes a welcome return in chiffon, more ladylike just-below-the-knee length and a classic peasant dress ...
SES ASTRA Announces RTL2 Launch in High Definition
2010-10-29
SES ASTRA, an SES company, has announced that the German entertainment channel RTL2 will launch in high-definition (HD) quality on HD+ starting in early December. HD+ is SES ASTRA's technical platform for the transmission and reception of TV programmes in HD quality via satellite for the German market
RTL2 HD is the seventh private free-TV-channel to launch on HD+. Other channels broadcasting via HD+ include RTL HD, Sat. 1 HD, ProSieben HD, VOX HD and kabel eins HD and most recently Sport1 HD, which starts 1 November 2010.
Since its market launch on 1 November 2009, ...
Artificial Intelligence Picks NFL Games
2010-10-29
It's 2010, the decade of the iPhone, Android and Google unmanned cars. Are modern-day computers advanced enough to predict NFL games with greater certainty than a human?
We'll use two test subjects, one called "Computer" and the other called "Human". Computer will be GameLine360.com, one of the most advanced online computer models available for NFL picks and NFL rankings. Human will be a consensus of the mainstream opinion-based power rankings.
In our test, we'll look at a few of the high probability games over the past few weeks with significant differences between ...
Personal Secrets & Scandals Made Public by Story Peeps Secret Society
2010-10-29
Story Peeps Secret Society started out as a medium for the creator (who goes by the username SP Master) to vent his own personal secrets, which he carried around for years without the comfort of being able to expose them to someone else because of his trust issues.
"The problem is that it's hard for me to trust people, because I have been stabbed in the back and betrayed countless times. And after years and years of walking around with this baggage of personal secrets, I kept thinking about how great it would be if I could vent them anonymously and help people who are ...
LAST 30 PRESS RELEASES:
Schlechter named Cancer Moonshot Scholar
Two-way water transfers can ensure reliability, save money for urban and agricultural users during drought in Western U.S., new study shows
New issue of advances in dental research explores the role of women in dental, clinical, and translational research
Team unlocks new insights on pulsar signals
Great apes visually track subject-object relationships like humans do
Recovery of testing for heart disease risk factors post-COVID remains patchy
Final data and undiscovered images from NASA’s NEOWISE
Nucleoporin93: A silent protector in vascular health
Can we avert the looming food crisis of climate change?
Alcohol use and antiobesity medication treatment
Study reveals cause of common cancer immunotherapy side effect
New era in amphibian biology
Harbor service, VAST Data provide boost for NCSA systems
New prognostic model enhances survival prediction in liver failure
China focuses on improving air quality via the coordinated control of fine particles and ozone
Machine learning reveals behaviors linked with early Alzheimer’s, points to new treatments
Novel gene therapy trial for sickle cell disease launches
Engineering hypoallergenic cats
Microwave-induced pyrolysis: A promising solution for recycling electric cables
Cooling with light: Exploring optical cooling in semiconductor quantum dots
Breakthrough in clean energy: Scientists pioneer novel heat-to-electricity conversion
Study finds opposing effects of short-term and continuous noise on western bluebird parental care
Quantifying disease impact and overcoming practical treatment barriers for primary progressive aphasia
Sports betting and financial market data show how people misinterpret new information in predictable ways
Long COVID brain fog linked to lung function
Concussions slow brain activity of high school football players
Study details how cancer cells fend off starvation and death from chemotherapy
Transformation of UN SDGs only way forward for sustainable development
New study reveals genetic drivers of early onset type 2 diabetes in South Asians
Delay and pay: Tipping point costs quadruple after waiting
[Press-News.org] Subrogation in Auto Insurance and Workers' Compensation CasesSubrogation is the procedure by which a party pays another's debt and then seeks to assert the legal rights of the party who has been paid in order to recover that money.