What is a Subrogation Claim for a Car Accident

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Written By Rocky Horton

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If you were involved in a car crash, you are likely worried about getting enough compensation to pay for your medical bills, lost wages, and property damage. This is especially true in cases involving an at-fault driver who was underinsured or uninsured at the time of the accident.

A subrogation claim for a car accident could help you recoup your losses from your insurer in the event that the at-fault driver’s insurer doesn’t pay you enough. However, the process of filing a subrogation claim is complicated and differs between states. I recommend contacting an experienced accident attorney to learn whether filing a subrogation claim for a car accident is in your best interest.

What is subrogation?

Subrogation means substituting one party for another in an insurance claim. In the case of a subrogation claim for a car accident, your insurer will compensate you for your injuries when the at-fault driver’s insurer does not, usually because the driver was underinsured.

Your insurer will then want to recoup the costs that it paid on behalf of the at-fault driver. This is where subrogation comes in. Your insurer will file a claim of subrogation against either the at-fault driver or their insurer to recoup their costs, including your deductible.

In my experience, subrogation helps victims get the compensation they deserve for their car accident injury claim. However, subrogation is a potentially more complicated and lengthy process than a normal insurance claim.

What does “right of subrogation” mean?

The “right of subrogation” means that the insurer of the driver who was not at fault for the accident has the legal right to assume responsibility for the damages that would normally be paid by the other insurer. It also means that your insurer has the right to bring a claim against the at-fault party (the driver or the insurance company) to be repaid for these costs.

In my experience, insurers usually invoke their right of subrogation without needing their client’s input. It’s between them and the at-fault party at that point.

How does state subrogation law work in car accidents?

When it comes to insurance law, most states have strict legal statutes governing how claims are made and resolved. For example, in Indiana, the property value that can be reimbursed is equal to the value of the property before sustaining the injury. But in California, reimbursement equals either the repair costs or the loss of the property’s value, not both.

Each state also has a different statute of limitations for a subrogation claim for a car accident, which is the number of years after the accident that your insurer has to file the claim. States also have different requirements concerning how much insurance drivers need. In Florida, for instance, drivers are not required to have bodily injury coverage.

The difficulty in understanding the complex differences between state laws regarding subrogation is one of the main reasons I tell my clients to find an experienced attorney in their area. They will be familiar with the fine print of your state’s laws.

Why most people have never heard the term “subrogation”

Subrogation is an important legal concept since it allows your insurer to step in and compensate you for the damages when the at-fault driver’s insurer hasn’t. But many people have never heard of the term because it’s usually settled between the two insurers or your insurer and the other driver.

I rarely see the driver required to do anything in a subrogation case since the insurer covers the damages either way. But in cases where you are also suing the at-fault driver or their insurer, you will likely be more involved. If you’re considering that, I recommend asking your attorney about what you need to do to resolve a claim for subrogation in your favor since the internet can only tell you so much about your case.

An example of subrogation

Due to differences in the ways that different states define fault in a car accident as well as the particulars of each case, every subrogation claim is different. Consider this example:

In an intersection, another driver runs their red light and t-bones your car. They are insured, but their policy has very little coverage, and you sustain serious bodily injury. Your medical expenses are covered by your insurance policy since the at-fault driver didn’t have enough coverage.

Under your underinsured motorist coverage (UM), your insurer exercises its right to subrogation to file a claim against the at-fault driver to recoup their costs, including your deductible. They typically won’t do this unless they think the at-fault driver has the assets to pay the claim.

How does subrogation impact a victim in a crash case?

If you are the victim in a car accident case, subrogation may not affect you at all. After you invoke your UM coverage, your insurer will file the claim against the other driver or insurer, and in many cases, you won’t even know it’s happening.

If you are also suing the at-fault insurer, you may have to actively participate in the lawsuit. Otherwise, subrogation allows victims to recover from their injuries while their insurer handles the claim.

Breaking down the subrogation process

Even though you don’t usually have to participate in subrogation, here are a few things I recommend you do to make the process go smoothly:

  • Report the accident to your insurer as soon as possible
  • Accept medical attention at the scene and/or immediately afterward
  • Gather any evidence you need to support your innocence or the other driver’s fault, including photos of the accident and road conditions, eyewitness contact information, and a copy of the police report
  • Ask your insurer about how your UM coverage will impact your settlement
  • Hire an experienced accident attorney to help put everything together

What is a waiver of subrogation?

A waiver of subrogation is a form that the at-fault driver will usually propose. Once signed, this form prevents your insurer from acting on your behalf, essentially canceling the right to subrogation in your case.

The reason the at-fault driver may propose this is if they want to settle the case with you out of court. The form would basically force the insurance companies out of the picture.

You may be able to settle more easily this way if you can agree on satisfactory compensation with the other driver. However, signing a waiver of subrogation is risky since your insurer can no longer help you. I always recommend having an accident attorney in your corner before signing one.

Discuss subrogation with your claim representative

I know how tough it is to recover from serious injuries and file for compensation at the same time. In cases where the at-fault driver is underinsured, subrogation steps in to empower your insurer to cover your damages and then sue the other insurer for the costs.

This process usually doesn’t require your participation, giving you time to recover. However, subrogation differs between states and may not be in your best interest, particularly if the at-fault driver is not able to pay the damages. Contact an experienced accident attorney in your area to see if a subrogation claim for a car accident is the right move in your situation.

Rocky Horton

Rocky Horton


Rocky Horton is a health and safety expert from Chapel Hill, NC. He is the founder of AccidentAdvisor and has been featured in Forbes, Bloomberg, and other publications. Learn more.