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What Does it Mean to Subrogate a Claim?

Posted in Car Accidents on April 5, 2020

As the victim of an accident in Texas, you will need to deal with many processes you might never have encountered before. Sorting through the insurance system in pursuit of compensation for your claim can be difficult as the injured party. Insurance subrogation can make things easier. Subrogation is a common process in which your insurance company gives you money for your damages upfront, then goes up against the defendant for reimbursement. A Dallas personal injury attorney can help you understand subrogation after a serious accident in Texas.

What Is Insurance Claim Subrogation?

 All insurance companies reserve the right to bring their own claims against at-fault parties after harmful accidents. Subrogation is the term used to describe this legal right. If someone else gave you an injury, for example, and your car insurance company fronts the costs of medical care, your insurer will then have the right to seek compensation from the at-fault party to repay what it spent on your care. Since you did not cause the accident, your insurance company may not intend to pay the costs. Subrogation is the insurance company’s right to pursue repayment from the at-fault party.

 Subrogation specifically refers to the act of one party filing a lawsuit on behalf of another to collect a debt. It is the process by which an insurance company pursues recovery of the financial losses it – or its policyholder – incurred due to the carelessness or negligence or a third party. Successful subrogation could repay the insurance company for what it paid on your claim. It could also end in some reimbursement for you, such as for any deductibles you paid your insurer to receive the coverage. Subrogation is most common after auto accidents, especially when you file a claim with your own auto insurance provider for a crash you did not cause (e.g. an uninsured/underinsured motorist claim).

 How Long Does a Subrogation Claim Take?

 If your insurance company decides to subrogate your claim, you should receive payment for your vehicle repairs, medical bills and other expenses from your insurance company right away. You will file a first-party claim and receive benefits within 15 to 30 days, in most cases. Your insurance company will need to notify you if it plans to subrogate your claim. If subrogation succeeds, you can receive your deductible back. If your insurance company does not subrogate your claim, you may have the right to seek the reimbursement of your deductible from the defendant on your own.

 Your role is generally small in insurance claim subrogation. Your insurance company and the claims process will need minimal involvement from you. If the other driver or party was clearly at fault for your accident, it may be easy for your insurance company to receive reimbursement from the defendant. A simple subrogation claim can take around 30 days to a couple of months to complete from start to finish. If, however, it is difficult for the insurance company to prove the defendant’s fault, subrogation could take longer. A subrogation claim could take one to several years in complex cases.

 Some insurance policies have waivers of subrogation. This is a provision in the policy in which the insurance carrier waives its rights to subrogation. Insurance policies with these provisions often cost more, since it puts the insurer at greater financial risk. If your insurance company chooses to subrogate your claim, you cannot seek damages yourself from the third party that caused your accident. You cannot seek recovery from both your insurer and the at-fault party. It is important, therefore, to choose your recovery method wisely before you file. Speak to a Dallas injury attorney before deciding how to file your claim. A lawyer can review all your options and choose the one with the best odds of fully reimbursing you for your losses.