Most insurance policies contain a subrogation clause. Subrogation is an insurance claims process where a company looks for reimbursement from an at-fault party. In an article for Findlaw, lawyer George T. Faris advises that the phrase may appear in a policy as your insurer agreeing to waive a right of subrogation or your insurer may be subrogated to the claims of another company.
Duhaime.org states that subrogation can occur contractually where two parties agree to transfer debt or liability. It aims to prevent double profiting from a loss. For example, you get in a car accident, and someone else is at fault. You submit a claim and your insurer pays for repairs. You and your insurer cannot benefit from your loss. Your insurer assumes a right of subrogation to get back amounts paid to fix your vehicle.
Subrogation may be waived. Faris explains that certain leases contain provisions where a landlord or tenant waives a right of recovery if a loss is covered by insurance, or an insurance policy contains a clause waiving any right of subrogation. For example, if your landlord holds you not at fault for damages, your landlord can get her insurer to waive a right of subrogation. The insurer pays the claim, but doesn't seek reimbursement from you.
If there is no waiver and you're at fault for damages or loss, another party or an insurance company has a right of subrogation. Encompass Insurance advises that your insurance company handles this kind of claim. They typically conduct an investigation to determine your involvement and potential liability for the damages claimed. Importantly, no insurance company can profit from paying any claim on your behalf. Subrogation ensures that only amounts you're liable for are paid.