How Does Subrogation Impact Your Compensation in a Personal Injury Case?
When you’re injured due to someone else’s negligence, your primary focus is on healing and then getting compensation for medical bills, lost wages, and other damages. However, there is an important legal concept that can affect how much compensation you ultimately receive: subrogation. Understanding subrogation and how it works in a personal injury case is crucial to protecting your financial interests.
What is Subrogation?
Subrogation is the legal process that allows an insurance company, or sometimes another third party, to step into your shoes to recover the money it has paid out on your behalf. For example, if your health insurance company pays your medical bills after a car accident, it may seek reimbursement from any settlement or judgment you receive from the at-fault party.
How Subrogation Works
Subrogation is perhaps best understood by looking at an example. Consider that you were injured in a car accident caused by another driver’s negligence. You receive medical treatment, and your health insurance company covers the costs.
You then file a personal injury claim against the at-fault driver. If you receive compensation from the at-fault driver’s insurance, your health insurance company may exercise its subrogation rights to recover the amount it paid for your medical bills.
Note that subrogation can work to reduce the total amount of compensation you take home. Again, let us look at an example.
Assume you receive a settlement of $100,000 for your injuries in the above car accident. If your health insurance company paid $30,000 in medical expenses, they may have the right to claim reimbursement of that $30,000. This means you would be left with $70,000 in compensation as opposed to the original $100,000.
Negotiating Subrogation Claims
The good news is that subrogation claims are often negotiable. Experienced personal injury attorneys can sometimes reduce the amount of the insurer’s claim, either by challenging the validity of the expenses or negotiating for a lower repayment amount.
In many cases, insurers are willing to accept less than the full amount to avoid the cost of prolonged negotiations or litigation.
Types of Subrogation in Personal Injury Cases
There are several types of subrogation that might arise in a personal injury case. These include:
- Health insurance subrogation: Your health insurer seeks reimbursement for medical bills paid on your behalf.
- Medicare or Medicaid subrogation: If you received benefits from Medicare or Medicaid, the government may seek to recover a portion of your settlement.
- Workers’ compensation subrogation: If your injuries occurred at work and workers’ compensation paid for your medical care, they might have a claim to part of your settlement.
What You Can Do
Please do the following to minimize the impact of subrogation on your compensation:
- Hire an attorney: A skilled personal injury attorney can negotiate with insurance companies and ensure that subrogation claims are minimized.
- Understand your policy: Check the terms of your health insurance policy or workers’ compensation benefits to understand their subrogation rights.
- Stay informed: Always be aware of the potential for subrogation when negotiating your settlement, and don’t assume that all of the compensation will be yours to keep.
Contact Justice Through Compensation for Help
If you or a loved one was injured in an accident, please know that the law firm of Justice Through Compensation is here to help. Our legal team is skilled, experienced, and passionate in their representation. Let us shoulder the burden of an injury claim or lawsuit while you focus on healing from your injuries. Contact us today for the quality legal help you deserve.
* Main image at top by freepik