Glossary

What is Subrogation?

The right of an insurer to pursue a third party that caused a loss to the insured, recovering the amount paid on the claim.

Full Definition

Subrogation is the legal right of an insurance company to pursue recovery from a third party responsible for causing a loss that the insurer has paid. After paying a claim, the insurer 'steps into the shoes' of the insured and can seek reimbursement from the at-fault party. For example, if a company's property is damaged by a contractor's negligence, the property insurer pays the claim and then subrogate against the contractor (or the contractor's insurer). Subrogation helps keep insurance costs lower by ensuring that responsible parties bear the ultimate cost of losses.

Related Terms

Indemnification

Certificate of Insurance

Loss Run

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Related Coverage & Services

Commercial Property Insurance

Commercial property insurance covers buildings, equipment, inventory, and business personal property against physical loss or damage.

General Liability Insurance

General liability insurance covers third-party bodily injury, property damage, and personal/advertising injury claims.

Indemnification

A contractual obligation by one party to compensate another for losses or damages incurred.

Certificate of Insurance

A document issued by an insurer or broker that summarizes the key terms of an insurance policy, used to verify coverage for third parties.

Loss Run

A report from an insurance carrier that details all claims filed under a policy during a specified period, used in the renewal and marketing process.

Business Insurance

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