This is a common question our Louisville car accident attorneys hear from many of our clients. The short answer is that your insurance policy has a subrogation clause buried in the fine print. Your insurance agent or employer probably did not explain this clause to you. Therefore, if you have never been injured in an accident until now, you have not had any reason to deal with this clause. However, this one clause can complicate your accident settlement, especially if you are attempting to handle the accident claim without an attorney.
What Is A Subrogation Claim?
The easiest way to explain a subrogation claim is to provide an example. Let’s assume you were injured in a car accident that was not your fault. After the crash, you were transported to the emergency room where you were admitted to the hospital. Your injuries were substantial. You needed surgery and physical therapy to recover from the crash. The providers filed claims with your health insurance company, which paid the claims according to your insurance coverage.
The insurance company for the other driver agrees to settle your accident claim. However, before you receive the proceeds from the settlement, your health insurance company places you and your attorney that it has a subrogation claim. Your attorney explains that you must pay your health insurance company back for each bill it paid related to the car accident BEFORE you receive any funds from the settlement. In other words, your health insurance company is paid from the settlement funds. This is what we call a subrogation claim.
Do I Have To Pay The Full Amount Back?
In most cases, the insurance company is entitled to full compensation for its subrogation claim. This can be a real problem in cases where the damages exceed the maximum insurance coverage for the other driver. In such a case, you could be expected to pay all of your settlement proceeds to your health insurance company to settle its subrogation claim. You could be left with nothing.
The good news is that your health insurance company can agree to accept a lesser amount to settle its subrogation claim. The bad news is that the insurance company is not legally required to negotiate a settlement for its claim. The company is not required to accept less than the amount it paid for accident bills.
Hiring an experienced Louisville car accident attorney can help. We understand the complexities of settling a subrogation claim. In some cases, we can negotiate a lower amount with the health insurance company to resolve the claim. A subrogation claim can be a massive obstacle in getting a car accident case settled. Having an attorney with experience in these matters can reduce the size of that obstacle to a manageable size.
Protect Your Legal Rights
If you have been injured in a car accident, you need an attorney on your side to protect your rights with your health insurance company and the insurance company for the other driver. We can help!