You had an accident involving another car and believe it is their fault and lodged (or thinking about) a liability claim against them. But the process is taking long and your auto insurance carrier suggests that you should get it repaired using your own policy and subrogate after. This post will try to explain the intricacies of these situations and how it is used to help motorists who are being messed around by third parties or their representatives.
Subrogation is a process where one insurance company gets back the claim payment made to a policyholder from another insurer because the latter covers the at fault driver, who is naturally responsible for the damages.
You were involved in a crash you believe the other side caused. However, they are playing hardball and not accepting the responsibility easily and delaying in dealing with your third party claim against them as fast as you like. In the meantime, the vehicle is sitting in some repair shop and nobody knows what to do. The garage cannot start the work and you cannot use it.
If you have Collision Coverage you can ask your insurance company to compensate for the damages now. This is not the ideal solution, as you would prefer this claim to be dealt by the other side and avoid making it on your own policy. Unfortunately, the latter solution would mean that it would be registered as a claim against you and you would need to pay collision deductible. Nonetheless, you waited enough and you want the car back. Not having it is making life difficult. These things can drag along a bit and the latter alternative could be an unavoidable way of moving forward.
Once they settled with you, all the rights relating to this incident have now been transferred from you to your insurer. They would be entitled to chase after responsible parties in order to recover the money they paid to you. It is only fair because they ended up covering losses that should have been settled by at fault third parties or their carriers.
A successful subrogation process will help you in two ways. Firstly, the accident will go down as no fault and you won’t suffer premium increases for several years. Secondly, you will be refunded the deductible spending.
Subrogation is something companies do to get back the money they had to spend in order to help a client. Sometimes they may decide to go after an individual if there is no liability policy in place and they believe they can get money. Essentially, they are helping themselves a lot more than they are helping you because they paid much more money than you did. It is worth noting that they don’t have to take this route. They may simply deem it not worth going after or feel they cannot get anything anyway. You cannot make them follow it through.
Funny enough, they may even need to subrogate themselves. For example, the person you had an accident with may be their policyholder as well. If the other driver is not responding to requests to file a report and so on, they may decide to settle with you first since you have alternative coverage. They will then get to at fault party somehow. If they cannot, they will have to make a judgement at the end. If it is favorable to you they will take the money out of one pocket and put it into another. It really doesn’t matter how it happens as long as you get justice.
Unfortunately, dealing with incidents involving others can be a real problem. It would be said if you had to face all the consequences of someone’s mistake and they were to get away scot-free. It is a perfectly legitimate process and helps everyone in the end by making everyone accountable and pay for damages they caused.