If you were the party not at-fault in a car accident, the thought of having to pay an insurance deductible for something you did not cause may seem innately unfair. In fact, you may want to find a way to be compensated for paying your deductible or at least find a way to receive that money back.
How do you go about doing this? Can you include your insurance deductible in your car accident claim?
We have asked attorney Alaina Sullivan about how insurance and personal injury claims interact. Here's her breakdown of the situation:
Insurance Deductibles 101
The dreaded deductible: how is this figure determined? Normally, the amount of your insurance deductible is determined by your car insurance policy.
If you have a higher deductible, then your monthly premiums are kept lower. You will rarely find a policy that has no deductible. That type of policy can cost a little bit more if you are wanting to avoid paying a deductible.
Essentially, if you want to file a car insurance claim, you will first need to pay your deductible in order to process the claim.
After that payment is made, your insurance company pays the difference between the cost of repairs and your deductible, up to the limit of your insurance policy.
The Concept of Subrogation
Subrogation is a legal term that allows one party to a case to make payment to the other party for money that is owed. This party would also include the other driver’s insurance company. The party then later collects money from the party that owed the debt after the fact.
Subrogation is usually the last step in the “claims” process and is normally only handled between the two insurance providers.
What Is Included in Subrogation?
When it comes to subrogation, an insurance company will request the money that it paid to have the car repaired or totaled, and this includes the deductible that was paid. Once the insurance company receives the funds back from the other insurance company, the policy owner will receive his or her deductible that was paid back.
When Is Subrogation Appropriate?
In settling an insurance claim, your insurance company will likely first pay the claim to cover your damages and injuries and then seek to recover the money it paid later. While it pays this amount upfront, fault is not quite determined at this point.
The investigation must still be completed as to who was at-fault in your accident. After that is determined the insurance company is then able to recover the costs.
Notice of Subrogation
If the insurance company decides to pursue subrogation, the company is legally required to inform you that it is pursuing subrogation. Why is this notice necessary?
The first reason is that if the insurance company is seeking subrogation, it means that it is also seeking to recover the cost of your deductible as well. This means that its actions also affects you.
It is thereby obligated to refund you the money once is issued.
In addition, under your insurance policy, you are required to also cooperate with your insurer to pursue subrogation. This cooperation also means that you are not allowed to sign any waivers or enter into any agreements that would release the other driver from liability in the event that he or she is determined to be at-fault.
Can I Seek the Deductible without Subrogation?
You can still attempt to recover your deductible from the other driver or his insurance company. However, it is cheaper and much easier to recover your paid deductible if you let your insurance company seek subrogation for you.
Partial Fault and Subrogation
If, after all is said and done, the insurance company finds that you are partially at fault, the amount that you can receive back from your deductible could be affected. If you are in a comparative fault jurisdiction, and you are determined to be 30 percent at fault, you could only seek reimbursement for the percentage you were not at fault.
Can I Waive Subrogation?
Think hard before deciding to waive anything. As stated previously, if you are pursuing subrogation, it is important that you do not sign any waivers or agreements.
Most insurance companies will include what is called a “waiver of subrogation” clause in any settlement agreement, and this waiver protects the company from later having to pay anything back to your insurance company. The company, after all, keeping its bottom line safe.
If you choose to sign a waiver, be aware that your insurance company may later refuse to pay your claim if it cannot seek reimbursement from the other party’s insurance provider.
Contact an Attorney Today
If you have been in a car accident and have questions about subrogation and how you can be compensated for paying your deductible, it is always recommended you contact an attorney today to discuss your case if you do not currently have a lawyer or have any questions.
A licensed personal injury attorney will be able to evaluate your case and determine if you have a claim against the other party’s insurance company, and what damages you would be able to claim.
To receive the compensation for your medical bills, property damages, and pain and suffering, you should speak with a personal injury attorney in your area today.
