Though they are distinctly different industries, the legal field and the insurance field overlap frequently. They are also similar in the sense that when you interact with them, you are likely under a great deal of stress (if you weren’t, you probably wouldn’t be in need of their services). This week, Deputy & Mizell, LLC is here to shed some light on one aspect of insurance that frequently overlaps with the legal field: subrogation.
What Is Subrogation?
Subrogation is a law that allows one party to make a payment that is actually owed by another party and then seek compensation from the latter for the debt that is now owed to them. For illustration purposes, imagine that you were in a car accident caused by the negligence of another driver. In this case, it should be the responsibility of the other driver’s insurance company to cover the associated expenses. Subrogation allows your insurance company to cover the cost of your medical bills and auto repairs, and then seek compensation from the other driver’s insurance carrier after the fact.
If both you and the other party shared the responsibility for the accident, your insurance company may only be entitled to seek repayment for the percentage of damages that correlates to the percentage you were responsible for the accident. For example, if the police report indicates that you 30% responsible for the car accident, your insurance company may only be able to receive compensation for 70% of the damages.
Subrogation is used in a variety of different insurance types. Auto insurance offers a convenient example, but subrogation is also used in health insurance, workers’ compensation, and other types.
How Does Subrogation Affect You?
As the policy holder, you may hear little about the process of subrogation, but that doesn’t mean it is any less critical. In fact, insurance companies are legally required to inform you if they intend to pursue subrogation from another party. If they are successful in receiving reimbursement for their expenses, they are required to refund you the deductible you paid. In the event that you are partially at fault for the accident in question, you may only be able to receive the percentage of your deductible that correlates to the percentage you were responsible for the accident.
Waiving Subrogation Rights
When you take out a new insurance policy, some insurance companies will try to get you to sign a “waiver of subrogation” clause. If this waiver is signed, it can prevent your insurance company from seeking repayment for damages paid on your behalf. This is not always wise, because it can ultimately deter your insurance company from making payments on your behalf.
Deputy & Mizell, LLC Is Here To Represent You
Communicating with insurance companies is often challenging, confusing, and stressful. If you have been in a car accident at the Lake of the Ozarks, injured at work, or the victim of some other accident that you think subrogation may apply to, contact our attorneys in Camden County MO for representation. We can help you evaluate your case to determine the best course of action.
If you are taking out a new insurance policy with a new carrier, we would be happy to read over your carrier’s proposed contract to ensure that you are not agreeing to anything that may prove undesirable at a later date. For more information about how we may be able to serve you, call us at 1-877-532-2191 or visit our website at www.DeputyAndMizell.com. Your initial consultation is always free.
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