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What Is a Subrogation Claim?

Posted in Personal Injury

Subrogation is a process that may be used in your personal injury case to reimburse an insurance provider for the money that it spent on your recovery, such as for your medical bills. If the insurance company that paid was not legally responsible for doing so, it can use a subrogation claim to seek reimbursement from the party that is liable. Learning more about this area of personal injury law can help you know what to expect if you were recently injured in New Mexico.

What Does Subrogation Mean During a Personal Injury Case?

Subrogation means that one party is substituting or standing in place of another. In a personal injury case, subrogation is a common way for an accident victim to get the money that he or she needs for medical bills and other expenses right away, without having to wait for a personal injury case to be processed. With subrogation, the victim’s insurance company pays for the upfront costs, then files a subrogation claim to seek reimbursement from the at-fault party.

The purpose of subrogation is to prevent an accident victim in New Mexico from recovering financial compensation twice for the same injury. Without subrogation, a victim could have his or her medical bills paid by one insurance company and then receive a settlement or judgment award for those same medical bills from another insurance company. To prevent this double recovery, insurance companies can file subrogation claims against a victim’s settlement to seek reimbursement.

What Are the Steps of a Subrogation Claim?

A subrogation claim typically requires very little involvement from the victim. This process is done between two insurance companies, or the victim’s insurance company and the defendant. Here’s how subrogation works, in general:

  • Your health, automobile or homeowners insurance company stands in for the at-fault party to pay for your bills and costs immediately after an accident. The insurer will pay according to the terms of your insurance policy. You may or may not need to pay a deductible.
  • The insurance carrier notifies you of its intent to file a subrogation claim. If you don’t receive this notification, assume that you have the right to seek financial compensation for your own costs, including insurance deductibles, from the defendant on your own.
  • The insurance company files a subrogation claim to seek reimbursement for the benefits that it gave you. This claim will give the insurance company the right to recover financial compensation from the defendant to reimburse what it spent on your losses.

Subrogation may or may not add time to the length of a personal injury case, depending on the situation. If there are complications, such as a liability dispute or an uninsured driver in a car accident case, this could increase the amount of time that subrogation takes.

How Might Subrogation Affect Your Settlement?

If an insurance company files a subrogation claim during your personal injury lawsuit in New Mexico, it could impact your settlement by allocating a portion of it to the insurer. Since the money spent on your medical bills did not come out of your pocket, however, this will not technically change your settlement value. Instead, your settlement or judgment award simply will not include an amount to pay for the medical bills or other expenses that the insurance company already covered for you. If the insurer does not subrogate your claim, you can recover compensation for the price of your medical bills from the defendant yourself.

Do You Need an Attorney’s Assistance With Subrogation?

Subrogation can be complicated. If you hire an Albuquerque personal injury attorney, he or she can deal with subrogation with your insurance carrier on your behalf, allowing you to focus fully on healing from your injuries. Your lawyer can help you find out if an insurance company is choosing to file a subrogation claim and explain how this might impact your case. An attorney may also be able to negotiate with an insurance company to reduce the value of a subrogation claim to benefit you. Discuss your case in more detail with an attorney from The Fine Law Firm for more information.

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