Subrogation gives a third party in an injury claim a right in money. The majority of the time the third party is an insurance company. These claims involve three parties: the insurance company, the person that is insured by the insurance company and the person that is responsible for the damages. The vast majority of insurance policies include a subrogation policy. Subrogation forces the person who caused the harm to cover the damages rather than the person who received the injury. Most subrogation claims are found in personal injury claims and in workers’ compensation claims that are being disputed. The compensation comes from the insurer of whoever is held responsible for the accident. 
This is important because subrogation impacts the amount of compensation that the injured party receives from their personal injury awards. Alabama’s subrogation and insurance laws can be quite complex. An experienced personal injury lawyer can help people who have been injured in a car accident. Under Alabama law, the contractual right of subrogation for medical payment is enforceable by the insured.
The right of the third party to subrogate states that if your insurance company pays for medical bills sustained from an accident that you did not cause, the third party would then have the right to collect reimbursement from the party that caused the injuries. In short, a subrogation claim is a legal process where the insurance company seeks to be reimbursed for the amount that it has paid to you.
A simple example of a subrogation claim is if you were to get in a car accident and the other driver is at fault. You could report the vehicle or trucking accident to the other person’s insurance company and file a claim. Then the other driver’s insurance company would pay you for the repairs to your vehicle and to cover any medical bills that you may have from the accident. If the other driver’s insurance company is taking too long to reimburse you for your damages, then your own insurance company could cover the costs. In this instance your insurance company could then file a subrogation claim against the other driver and seek reimbursement for the money your insurance paid you.
In sum, subrogation allows for your insurance company to gather the costs from the at-fault driver’s insurance company. This protects you and your insurance company from paying damages that you did not cause.
Attorney Steven A. Harris regularly blogs in the areas of family law, bankruptcy, and real estate closings on this website. He is always available in any of the firm’s offices or by phone anytime for a consultation. Mr. Harris tries to provide informative information to the public in easily digestible formats. Hopefully you enjoyed this article and feel free to supply any feedback. We appreciate our readers and love to hear from you!