If you are involved in a car accident you may eventually encounter what is known as subrogation. Subrogation refers to an insurance company's right to be repaid for claims on which it has made a payment. If an insured sustains a loss and the insurance company pays on a subsequent claim, the insurance company could become a subrogated party. A subrogated party may initiate a lawsuit on their own or join into a lawsuit initiated by someone else. How subrogation affects you depends on whether the accident was your fault or another party's fault.
For example, say you were in a car accident that was not your fault and your car sustained damage which cost $1,000 to repair. If you have insurance and your insurance company pays for your auto repair, they may be subrogated to your claim. This means that if you sue the party that was responsible for the accident, your insurance company may join (or you may need to include them as a party) the lawsuit and try to recover the $1,000 it spent to have your car repaired. If you did not sustain an injury or any monetary loss which was not reimbursed by your insurance and decide not to sue the party that was responsible for the accident, your insurance company would maintain the right to sue the other party for the amount of money it had paid to you or to others on your behalf.
Conversely, if you are in a car accident that was in your fault you may face a subrogated insurance company. Again, the insurance company would be looking to recoup the money that they have spent to satisfy a claim, but in this case they would be looking to you for their reimbursement.
* Please note that this is general information only and not intended to be legal advice. If you have questions or need legal advice please setup an appointment with our attorney, or an attorney of your choosing.
Russell is an attorney with Nicolet Law Accident & Injury Lawyers. Russell represents injured clients in Hudson, New Richmond, River Falls, Prescott, Ellsworth, Roberts, Osceola, St. Croix Falls, Menomonie, Eau Claire, Chippewa Falls and surrounding areas of Wisconsin.
Nicolet Law Firm has offices in Eau Claire, WI, Hudson, WI and Woodbury, MN and handles car accidents and other personal injury claims. For more information call 1-855-NICOLET or visit www.nicoletlaw.com.