If you are involved in a car accident, you will likely hear the term “subrogation” mentioned by medical providers, insurance companies, or attorneys. While subrogation issues can be extremely complex, the term literally means that one party stands in the place of another. This principle is important when pursuing a lawsuit or insurance claim following a collision because the right to pursue a legal claim belongs to the party who suffered property damage, bodily injury, or other forms of loss. The principle of subrogation permits third parties to assert a legal claim in the place of the injured party under certain circumstances.
By way of example, a nineteen-year-old college student gets into a collision when he is T-boned by a drunk driver. If the college student decides not sue the drunk driver because he is a friend, his grandmother cannot simply bring a lawsuit because she is outraged by the intoxicated driver’s conduct. Subrogation rules permit the injured party to assign his or her rights to pursue legal remedies to another party. Effectively, the principle of subrogation permits an injury victim to empower a party to pursue a lawsuit who would not otherwise have standing to sue.
A common example of subrogation in the context of an auto accident involves medical bills. If you file a personal injury lawsuit seeking damages from the other party, medical expenses will be a component of your settlement or jury verdict. While you might recover $30,000 in medical bills from the other driver, your health insurance company can seek reimbursement from you if your insurer covered your medical bills while you were in the hospital. Put another way, you do not get to collect for medical bills from both your own health insurance company and the other driver and/or the other driver’s insurer.
The issue of subrogation also frequently arises in the context of uninsured or underinsured motorist (UM/UIM) claims. If the other driver does not have insurance or has insufficient coverage to compensate you for the full amount of your loss, you can pursue a claim against your own insurer under the UM/UIM coverage provision. When a policyholder obtains UM/UIM benefits under his or her own policy, the insurance company may pursue a lawsuit against the other driver to recover some or all of the compensation the carrier paid to its own insured. Although you are not a “real party” in this type of lawsuit between your insurance company and the negligent driver, you might have to participate as a witness by testifying in a deposition and/or at trial.
Because insurance companies often negotiate discounted rates with health care provider, our law firm can work with clients to maximize our clients’ net recovery. If your medical expenses are extensive, this negotiation of lower rates can result in valuable additional compensation to cover your living expenses and related costs following a serious accident. Our Mississippi car accident attorneys represent individual injured by careless and inattentive drivers. At Barrett Law,our Mississippi Car Accident Lawyer is here to help. Contact our firm today at 800-707-9577 to schedule your free consultation, so we can answer any questions you may have regarding filing your claim.