Subrogation is similar to contribution and is often talked about as a corollary of indemnity. What it means is that one person, usually the person who is doing the insuring, takes over the rights of another person, usually the one who is being insured. You will find that the majority of insurance documents include a subrogation condition or clause that will state that the insurer can take over and carry out a settlement or a defense of any claim as they decide appropriate.
This means that if the insured has made a claim and it has been paid by the insurer, the insurer has indemnified the insured and so has every right to try and recover the sum in any (legal) ways they see fit.
Practically, this means that if someone, for example, has been in a car accident that was caused by somebody else, they have the right to make a claim, and if the case is proved, damages will be paid by the insurance company of the person who was at fault. Without an insurer having a subrogation clause within a policy, the person making a claim would be able to claim through the insurance and also to make a civil claim in accordance with their legal rights, and so would be compensated twice, which opposes the indemnity principle.
The principle of indemnity and subrogation protects insurers from multiple claims for the same incident.
This means that if the insured has made a claim and it has been paid by the insurer, the insurer has indemnified the insured and so has every right to try and recover the sum in any (legal) ways they see fit.
Practically, this means that if someone, for example, has been in a car accident that was caused by somebody else, they have the right to make a claim, and if the case is proved, damages will be paid by the insurance company of the person who was at fault. Without an insurer having a subrogation clause within a policy, the person making a claim would be able to claim through the insurance and also to make a civil claim in accordance with their legal rights, and so would be compensated twice, which opposes the indemnity principle.
The principle of indemnity and subrogation protects insurers from multiple claims for the same incident.
