What is a Subrogation Claim and how do I fight it?

Growing up as a kid in Lagos, Nigeria, there were certain meals known for some days of the week, take for instance most weekdays in primary school, we usually have bread, tea, and egg. Now this story would have ended here, but no! The catch here is the way I did eat it [just like every kid I knew then], all you have to do is cut a piece of bread, dip into the rich chocolatey drink, and then aim for your mouth. You will know you are doing well when it drips over down your chin. This was one of the best things life could offer, I thought. 

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Fast forward to the life of paying bills, and my quest for any possible cover in place of insurance, I came across the word subrogation, which is a jargon in insurance that entails the act of pursuing a third party on behalf of a policyholder after the claim money has been paid. This for me was way better than the feeling of bread dipping down my chocolatey drink from China. 

Today, we shall consider subrogation, if good or bad, its examples, what happens when subrogation fails, the waiver provided for subrogation, how long it takes to process, what subrogation demand letter is all about, and a couple of other interesting subtopics for your knowledge. 

From the words on Wikipedia, a third party's legal right to collect a debt or damages is called subrogation. Subrogation is a legal notion that allows one person to enforce the rights of another who are still alive or have been revived for their advantage. 

It’s easy to say Subrogation is good because it allows insurers to recoup costs from at-fault drivers, lowering total auto insurance prices. Both excellent drivers and insurance companies gain from subrogation because it ensures that the at-fault person is held accountable for the harm they create. 

Subrogation is legal; hence it is right. For a clearer understanding of subrogation rights, the principle of subrogation states that an insurer who has paid a loss under an insurance policy has all of the insured's rights and remedies against a third party for any loss covered by the policy. 

A subrogation action is a move taken by your insurance provider when you sue the person at fault for your injuries, or damages caused to you or the property insured. 

A good example of subrogation is when you encountered a car accident and have to go on long-term disability due to injuries from the effect. This prompts your insurance provider to act on your behalf and demand damages from a third party for the policyholder. 

When an insurance company files a subrogation claim, the negligent third party will keep getting a phone call or a letter from the insurance company. However, if a third party is still nonchalant about this, a lawsuit might be slammed. 

A waiver of subrogation is a contract that gives up an insurer's right to seek compensation for losses caused by a third party. This means you're giving up the right to sue another person for damages. However, you're giving up your insurer's ability to sue on your behalf for damages. 

1. Statutory. 

2. Conventional or Contractual Subrogation; and. 

3. Equitable subrogation. 

1. Incorrect Personnel 

2. Inefficient Processes 

3. Lack of Strategic Support 

It's vital to note that you're not required by law to react to a subrogation letter delivered by someone else's insurance company. However, when this occurs, you can liaise with your insurance provider on stance and they will guide you accordingly. 

A subrogation demand letter is a written communication delivered by a subrogation adjuster to someone or something that seems to be liable for reimbursing an insurance company for damages caused to their client/policyholder.  

The third party who had caused damage to an insurance company’s policy holder’s property without repairs or paying for damages has the right to be subrogated.  

Since each insurer will try to limit their exposure, and if they are unable to reach an amicable agreement by any chance, this may resort to a lawsuit.  

Subrogation could take so long when the length of time it takes to execute subrogation is determined by the complexity of the accident case and the clarity of blame. 

In conclusion, subrogation is an interesting immunity that every policyholder should include, it simply involves an insurance provider advocating for you when a third party seems too rigid with the payment of damages and repairs to the property.