Guide to Auto Subrogation Claims

Here is everything you need to know about subrogation claims, a type of third-party claim.

How Long the Process Takes

The length of time it takes to complete an insurance claim depends on the details of the related incident. For example, a claim with a partial fault or an uninsured driver takes longer to process than one where both parties are insured and one party is completely responsible for the accident.

If you are not responsible for an accident and the third-party claim with the other party’s insurance is delayed, your own insurance company may help you pay for repairs in the meantime, which means you’ll have to pay your deductible. If and when your insurance company successfully recoups the costs from the at-fault party’s insurance, some or all of your deductible will be refunded to you.

Partial Fault

If both parties share fault, you will have to take a look at your state’s negligence laws to see how much you can recover. See the table for your state’s negligence laws, which we’ll explain more in detail below.

• Comparative negligence: States with comparative negligence allow both drivers to split the costs based on their individual degree of fault. In pure comparative negligence states, a driver involved in an accident can recover money even if they’re more at fault than the other driver. In modified comparative negligence states, recovery is limited by the degree of fault. In some states, a driver must be less than 50 percent at fault to receive compensation.
• Contributory negligence: In contributory negligence states, if a driver acted negligently in any way, they can’t receive any compensation from insurance carriers. In other words, contributory negligence law prevents your insurance company from attempting to recover or seek reimbursement for medical bills, repairs, etc., if you are at fault, even partially.

Uninsured Drivers

If you get into an accident with an uninsured driver, the subrogation process will take longer, as your insurance provider has to sue that driver directly rather than deal with their insurance provider. Given that an estimated 12 percent of drivers are uninsured across the U.S.,¹ it’s a good idea to have uninsured motorist coverage so you don’t have to wait for your insurance company to subrogate claims.

The Subrogation Process

Fortunately for you, most of the subrogation process occurs behind the scenes with the auto insurance companies, whether you’re filing a claim or receiving one. Just communicate with your provider if you are planning on taking legal action or signing a waiver of subrogation, which we detail below.

Let’s zoom out and learn more about subrogation in general.

What Is an Auto Subrogation?

Auto subrogation is a way that your auto insurance provider can prevent you from paying for an accident that wasn’t your fault by retrieving money from the at-fault party’s insurance company.

How Subrogation Works

Subrogation occurs when you are not at fault in an accident but had to pay for a deductible, car repairs, or medical costs. Your insurance provider will subrogate a claim with the at-fault party so you can get reimbursed for your costs. If it’s successful, you’ll receive a partial or full reimbursement.

Subrogation claims are part of the auto insurance process, but they’re not something that you as the policyholder will have to deal with. They are handled behind the scenes between insurance companies when one company attempts to recover money from the at-fault party’s insurance. However, if you’re at fault in an accident and your company pays out a subrogation claim to another insurer, your premiums may increase.