If you sustain an injury caused by the actions of another individual, business, or entity, you should be entitled to compensation for your losses. However, personal injury claims often take some time to conclude, which can be a problem when it comes to paying medical bills. Individuals regularly have to rely on their personal insurance carriers the cover their medical expenses while they await a settlement or jury verdict in a personal injury case. When a settlement or jury verdict comes through, the insurance carriers that already paid medical bills will need to be reimbursed through a process called subrogation.
Defining Subrogation
When we look at the most basic definition of “subrogation,” we can see that this means that one person will stand in place of another person regarding a debt. When an individual or entity pays a debt that is the responsibility of somebody else, then the person who originally paid the debt should be entitled to reimbursement from the person who should have paid it in the first place.
However, we understand that that does not make this any clearer to the average reader. In order to properly understand how subrogation works when it comes to a personal injury claim, we need to delve a little bit more into the nuts and bolts of this process.
How Does Subrogation Apply for These Claims?
Subrogation applies to personal injury claims when we are talking about medical bills. In the immediate aftermath of a person sustaining an injury caused by someone else, they will have various types of medical expenses that they need to be covered right away. However, there is little to no chance that a personal injury settlement or jury verdict will come in before those medical bills start piling into an injury victim’s mailbox.
Often, injury victims have to pay for these medical bills either out of their own pocket or with the assistance of their personal insurance carrier or an auto insurance carrier. They may have to do so even if another person is entirely at fault for causing their injuries.
However, if an injury victim’s personal insurance carriers pay for their medical bills, the carriers will typically have the right to be reimbursed for the amount of money that they paid out of any settlement from the at-fault party. This will include compensation that comes from the at-fault party’s insurance carrier or as a result of a personal injury jury verdict award.
A Brief Subrogation Example
Let us present a theoretical example for subrogation. Suppose Joseph is injured in a vehicle accident that was caused by Rebecca. However, Rebecca’s insurance carrier disputes the facts of the case, delaying claim payment.
Meanwhile, Joseph incurs $20,000 worth of initial medical bills that his personal insurance carrier pays on his behalf while the injury case against Rebecca is ongoing. Ultimately, let us suppose that Rebecca was indeed 100% at fault for the accident and her insurance carrier pays $100,000 for all of Joseph’s damages.
In this case, we will see that Joseph’s insurance carrier will have the right to recover the $20,000 that it paid in his initial medical bills. They will have the right to recover this money from the $100,000 settlement.
Working With an Attorney
It is very important for an individual who sustains an injury caused by the actions of another person or business to work with a skilled personal injury lawyer to help them with their case. An attorney can handle every aspect of these claims, including investigating the incident, determining liability, and helping victims recover maximum compensation. An attorney will also be able to thoroughly explain the process of subrogation so that injury victims are not caught off guard when the time comes to pay their bills.