What Subrogation Means For Personal Injury
After an injury, time is of the essence. Waiting for the person at fault to pay for your medical bills may not be an option. For most people, personal injury protection (or, PIP) doesn’t last long. Then, your health insurance will step in. This can give them subrogation rights.
If you decide to sue the third party in court and win a settlement, subrogation may be the next step. In some cases, the money from the settlement pays back bills that your health insurance paid.
Subrogation is a legal term that is often misinterpreted. Insurance companies have the opportunity to recover the money it paid upfront to cover an injury medical expense. This money comes from compensatory damages awarded to the injured party.
The responsible (at-fault) party’s insurance company pays the settlement. Then, the injured party’s insurance company is paid back for “covering” the expenses. The insurance company sometimes has the legal right to ask for a reimbursement.
Subrogation Rights and Interests
Subrogation occurs when another party handles the costs of the injury.
One point of view is that the injured party should not recover monies from the at-fault party and the health insurance company. Additionally, the injured party’s insurer should not be responsible to make payments due to the choices of the at-fault party.
In some situations, it is possible to reduce the amount needed to pay back. Additionally, the injured party’s attorney may have the ability to negotiate a smaller amount to pay back. Each situation is different.
After an accident, the injured party will forward medical bills to their insurance for payment. After PIP runs out, health insurance will take over.
Subrogation After Settlement
Many people are under the impression that after a settlement, they immediately get a check to spend at their own free will. But, this is not the case. When a personal injury lawsuit succeeds, subrogation payments come first. Additionally, any remaining liens are paid. Then, the remaining money is released to the injured person.