Financial

Subrogation

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Subrogation

An insurance process whereby a company that has paid out to a policyholder for a loss incurred recovers the amount of the loss from the party that is legally liable.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Subrogation

The transfer of a claim or legal right from one party to another. Subrogation is often associated with the transfer of the right to a debt from one person to another. That is, a creditor can give or sell his/her right to a debt to some third party. See also: Forfaiting.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

subrogation

The substitution of one party for another.Insurance companies typically have rights of subrogation, so if the insurer pays the property owner for a loss, such as a house fire, and then discovers that loss was the fault of a third party, the insurance company may sue and recover from the third party.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive
subrogates to the right of the insured to the extent of payment and then
After paying out the employer, the insurer sought to subrogate against the employee.
The courts have held that builders' risk insurers are entitled to subrogate against subcontractors provided coverage "as their interests may appear," concluding that this term is intended only "to give the subcontractor an interest in the building according to the amount of the subcontractor's work and material already utilized.
Rather, if the bankruptcy trustee has a direct [section] 548(a) theory against X, or if she can subrogate herself to [C.sub.2] or some other creditor of D, she can avoid D's conveyance to X.
In practice, the insurer's right to subrogate upon payment of any portion of the loss does not cause hardship to the insured.
The VA can also subrogate in cases that result from a motor vehicle accident in any state that requires the owners or operators of motor vehicles registered in that state to have enforced automobile accident reparations insurance.
However, claims examiners working for different claims administrators sometimes establish informal agreements not to subrogate against one another.
The limits and exclusions in the shop's policy are not typically shared and the collector's insurance company can pay a claim and subrogate against the shop if there are issues that might otherwise delay payment.
"If you have $2,000 worth of equipment damaged in a home fire or flood, you don't want the insurance company to subrogate against your employee," he explains.
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