Subrogation often comes up in personal injury and insurance cases, yet many people aren’t quite sure what it means. In simple terms, subrogation allows an insurance company that pays benefits on your behalf to seek reimbursement later from the party who caused your injuries. This usually happens after you receive a settlement or court award.
If you live in Pennsylvania and have a pending personal injury claim, subrogation might affect how much money you ultimately take home. Continue reading this article for more information, and contact an attorney for a free consultation if you need further help.
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How Subrogation Works in Pennsylvania
Pennsylvania law, as well as the terms of your insurance policies, guides how subrogation unfolds. Usually, your insurer will notify you that it has a right of subrogation or a lien against any third-party settlement or verdict. Once you recover compensation from the person or business that caused your injuries, the insurer can file a claim for reimbursement.
If your case concludes with a successful settlement or jury award, you typically receive the funds in a structured manner. Your attorney may place the money in a trust or escrow account. From there, attorney’s fees and case costs are usually paid first, and insurance liens or subrogation claims may be addressed next. Any remaining balance goes to you.
Understanding this sequence is important. If you have multiple insurance carriers, it’s possible they could all try to assert subrogation rights. Having an experienced attorney on your side can make the difference in the amount you ultimately recover.
Common Sources of Subrogation Claims
Several parties might claim a right to subrogation after a Pennsylvania personal injury case.
These can include:
- Health insurers: If your health plan paid for your hospital or doctor bills, it might demand reimbursement if you secure a settlement from the at-fault party.
- Auto insurance companies: In certain car accident scenarios, your insurance carrier may pay for your vehicle repairs or medical expenses and then pursue subrogation against the responsible driver’s insurer.
- Workers’ compensation insurers: If you were hurt on the job and collect workers’ comp benefits, the workers’ comp carrier may also have a lien on your personal injury recovery if someone other than your employer was at fault.
Each insurance provider typically has separate rules, deadlines, and procedures for asserting subrogation. If you fail to address one of these claims, it can create legal and financial complications down the road.
Reducing a Subrogation Claim
A subrogation claim doesn’t necessarily mean you’ll lose a large chunk of your settlement. In many cases, your lawyer can negotiate with the insurance carrier to reduce the amount it expects to recoup. This is often done to reflect the costs you bore in winning your case, as well as the fact that some claims might not be covered under your plan.
For instance, if you had to hire medical experts, pay court filing fees, or devote a lot of effort to proving the other party’s liability, insurers sometimes agree to take less than the original lien. Doing so helps them avoid protracted disputes and legal fees of their own. Successful negotiations can leave more money in your pocket.
How Subrogation Affects Your Personal Injury Compensation
When people first learn about subrogation, they may worry that insurance liens will wipe out their entire recovery. While subrogation can lower the net amount you receive, it usually doesn’t eliminate your compensation entirely—especially if your case is handled wisely.
The final outcome depends on factors like:
- The extent of your injuries and damages
- The size of your medical bills
- The insurance policies involved
- Any negotiations between your attorney and the insurance carrier
Subrogation can be seen as a sign that you received significant coverage when you needed it most. The insurer provided benefits right away rather than leaving you on the hook for medical expenses. Now, the insurer just wants to ensure it’s not the one ultimately paying for someone else’s wrongdoing.
Schedule a Free Consultation With a Harrisburg Personal Injury Lawyer
Strict liability claims, particularly product liability claims, can be difficult to win. Schedule a free consultation with a Harrisburg personal injury lawyer to find out whether your claim is viable. Most personal injury lawyers at Marzzacco Niven & Associates will not charge you any legal fees unless they win your case. Call us at (717) 231-1640.