Subrogation: What You Need to Know

Subrogation refers to a common insurance practice. The doctrine refers to an insurance company’s legal right to pursue a third party in order to recover damages paid to the policyholder as a result of a claim.

Subrogation is most common in auto accident cases but can also occur during property or healthcare policy claims. Typically, this process does not negatively impact the policyholder. But in some cases, subrogation can be used to take a portion of your personal injury settlement. A lawyer can help navigate the process, so this does not happen. 

An Example of Simple Auto Accident Subrogation

Let’s say, for example, you were just in a car accident that was not your fault. Another driver t-boned you as you legally passed through an intersection.

After the accident, your insurance adjuster investigates the case and ultimately arrives at a coverage amount. Your insurer quickly pays you this amount to repair your car and begin paying for medical expenses.

The insurer will then subrogate to recoup what they paid out to you. During this process, they’ll negotiate with the at-fault party’s insurance company. It may take several months before a financial agreement is reached. 

Caveats of Auto Accident Subrogation

Multiple scenarios can complicate automotive accident subrogation, such as:

• The at-fault party does not have insurance.
• You were partially at fault for the car accident.

Georgia has its own rules when it comes to subrogation. We detail this more in an upcoming section.

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Personal Injury FAQs

Subrogation After a Personal Injury Settlement

You could be subject to subrogation if you recently received a large personal injury settlement. The insurer or government agency paying for your medical expenses can subrogate your settlement to recoup some of their losses.

In this case, subrogation can become problematic. This legal process could reduce the amount of settlement money you get after a personal injury. 

Settlement Subrogation in Context

Imagine that you were in an accident. This accident could be a car accident, a worker’s compensation case, or another similar case. You were carrying insurance that provided you adequate coverage, so your insurer covered your initial medical costs.

At some point during your legal proceedings, you also received a personal injury settlement. This settlement was in addition to the insurance coverage you were already receiving.

The insurer who was providing you coverage can subrogate this settlement. They have legal grounds to claim some of your settlement to cover what they already paid you.

The Made Whole Doctrine

Georgia adheres to the Made Whole Doctrine, per O.C.G.A. § 33-24-56.1. This statute provides a legal defense for those subject to subrogation and is relatively plaintiff friendly.

This law mandates that an insurer can only recover a portion of your personal injury settlement if:

• The settlement exceeds the number of economic losses you sustained.
• The settlement exceeds the amount of non-economic losses you sustained.
• You must be “made whole” before taking a portion of your settlement.

Economic and non-economic losses in a personal injury case can include:

• Pain and suffering
• Current and future medical expenses
• Lost wages, both present, and future
• Loss of consortium (a legal term that refers to the loss of a close relationship)
• Loss of enjoyment of activities 
• Loss of income
• Reduced earning capacity

If your legal team can demonstrate that you will need the settlement to continue paying for your losses, you should be shielded from subrogation. This will protect you from losing a portion of your settlement.

What Should I Do If I Receive a Subrogation Notice?

Strongly consider hiring a personal injury lawyer. They can advise you based on the facts of your case. They know how to negotiate with the insurance company to avoid paying out a portion of your settlement to insurers. 

Need Help With Your Personal Injury Case?

The team at Bader Scott Injury Lawyers has secured considerable settlements for our past clients: Here are just a few examples:

• $1.9 million in a product liability case
• $2 million in a workers’ compensation case that included traumatic brain injuries (TBIs)
• $500,000 in a workers’ compensation case that involved amputation

Our previous clients appreciate our commitment to compassionate legal service and give us 5-star reviews, such as:

• “I was referred to Bader/Scott by my son. When I called your office I was connected to Ms. Karen Padilla who was very thorough and professional in her questions. She also made me feel at ease. I am very pleased with her performance.” – Eileen C.
• “I was so afraid to start the process and when I called and asked all the questions I was given answers that made me feel comfortable. I never had a problem like this before so going to this firm was the best decision I made. Thank you for helping me when I need it the most.” – Betty F.

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We are committed to empowering our clients and providing them the legal support they deserve, especially if your case is subject to subrogation.

Call to speak to a team member today during a free case evaluation.

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