Subrogation in Insurance

How Subrogation in Insurance works?

Let’s get real with an example

  • Things are always easier understood when we can connect it to a story, or an example. So here it goes. One fine day, your car happens to hurt after a reckless driver bumps into your car. Now, the back of your car is damaged, and this guy doesn’t even seem to accept his fault. You have no time to fight this out or argue further, so you move on with your damaged car and instead get your comprehensive car insurance to pay for the damages (minus the deductibles, of course!).  
    Now, this is exactly where this fancy term, “Subrogation” could help you out. Your insurance company here will hold the third-party responsible for the damage and reimburse both the amount of money you spent from your pocket, plus the amount of money your insurance company paid for due to the damages and losses caused.  

What is Waiver of Subrogation?

Key Things to Remember about Subrogation in Insurance

Explain it like I'm five

There are three brothers in a family. The eldest brother has promised to take care of his two younger siblings. One day, the youngest brother breaks a toy that belongs to the middle brother. The middle brother starts crying, so the eldest brother gets him a new toy. But to be fair to everyone, he ensures that the youngest brother pays for it from his own pocket money.

What just happened was ‘Subrogation’.

FAQs about Subrogation in Insurance