Health Insurance Procedures – Understanding the terms of your health insurance plan is important if you want to take advantage of its benefits. Unfortunately, the jargon used in many contracts and health insurance procedures can be confusing for someone who is not used to it. One term you might not be familiar with, but should know just in case, is subrogation. This simply refers to a procedure in which the insurance carrier seeks the money owed to them by a person or insurance company. Although this is something you might never need to worry about, knowing the process can help you avoid future problems.
There are several situations in which subrogation might be necessary. For example, say you were injured in some sort of accident and there is another person involved. Your insurance carrier might cover your costs initially, but then later discovers that the other person actually caused your injury. In this case, your insurance company might subrogate against the other party’s insurance company in order to recover the money they paid for your injury. It is also possible that your insurance carrier will want you to reimburse them as well.
Although subrogation often works in your favor, your insurance company might subrogate against you if you are actually the one at fault. This will be determined, at least in part, by your state. Some states use a comparative negligence system, while others prefer contributory negligence. In a state that uses some form of contributory negligence, you might owe your insurance company if you were even slightly at fault. In this case, it does not matter if the other party actually caused the accident. What matters is whether your actions contributed to your injury. Comparative negligence, in contrast, compares the contributions of each person involved when awarding financial compensation.
The best way to avoid subrogation is to know the laws in your state. If you suffer an injury, do not be afraid to ask for legal advice if necessary. If your claim is particularly high and you might be at fault, filing a claim might not be the best idea. Prepare a good defense if you feel that your insurance company might try to subrogate. Make sure to stay in touch and follow the proceedings at all times. Should an insurance company require you to pay, try to arrange a payment schedule if at all possible. Many insurance companies will be willing to work with you if you are reliable and open to compromise.
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