If you make a claim for injuries or damages under your insurance policy, and another person or company is at fault, your insurance company may choose to pay your claim and subrogate against the at-fault party.
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Subrogation is the process an insurance company uses to recover claim amounts paid to a policyholder from a negligent third party.
An insurance company subrogates a claims payment by filing a claim with another insurance company, or by making a written request for payment from the at-fault party. In some cases, subrogation may involve filing a lawsuit against a negligent third party.
When an insurance company successfully subrogates a claim, you may be reimbursed for any deductible you paid under your policy. You may also receive money for damages above your policy limits.
When an insurance company subrogates a claim for which it has already paid you, you are obligated to cooperate in any investigative procedures used to recover from the at-fault party.
Most insurance policies contain a clause that states that if you accept a claims payment from your insurance company, you waive all rights to recover from the negligent party. This right is transferred to your insurer.
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