Subrogation is the legally sound transfer of rights to debt collection from the guilty party for the losses caused by it from the insured to the insurer. Thus, quite often the procedure for replacing the creditor in a previously existing obligation occurs.
Subrogation and regression: differences
These two concepts are very similar, but in so doing, the regression represents the right of the reverse claim of the party that has compensated the losses to the second. And if subrogation is just a change of face, then regression implies a new commitment. According to it, all requirements are implemented in accordance with the new rules, different from the first.
Both regression and subrogation are indispensable components of legal relations in insurance practice. They are a consequence of the fulfillment of obligations under the agreements, however, the operations associated with them do not relate to the key activities of the company that executed the document.
Also, these two concepts have different limitation periods established regarding them at the legislative level. For example, for regressive obligations they are calculated from the moment the primary obligation is fulfilled. And the timing of subrogation is not so critical, because the change of ownership does not correlate with the countdown. Below we will consider all this in more detail.
Why subrogation is needed
This institution is used as the legal protection of insurers in the event of the relevant casco cases. Thus, companies want to distance themselves from fraudulent schemes and other circumstances.
Subrogation is a new concept in domestic law. Sometimes its use is associated with a number of difficulties. But at the same time, insurance subrogation protects the rights of both parties.
It looks like this: the injured party gets its indemnification in one case or another, CASCO is then relieved of subsequent worries related to relations with the culprit of the incident. And the insurance company through subrogation can maintain its reserves, which are aimed at payments.
The legislative framework
Subrogation to the insurer from the beneficiary proceeds in accordance with the relevant article of the Civil Code of the Russian Federation. Previously, the law applied only a regressive position for this. So, we used the Chart of Accounts for financial and other activities of insurance companies, which was approved by order of the Federal Inspectorate in charge of controlling this industry.
Despite the fact that over time, subrogation has changed regression, quite often the second mechanism is still used when the first is impossible to apply.
In particular, this applies to cases where, for example, the insurer cannot change the beneficiary to exercise the right of certain claims against the offending party, since it is he who is the one. In such cases, regression is more appropriate.
The law on compulsory liability insurance of vehicle owners contains a list of situations where such claims can be made to culprits in the amount of payments made. In addition, the insurer has the right to ask him to reimburse the expenses that were incurred during the consideration of the case.
Subrogation order
This procedure can only be completed in accordance with a property insurance contract. If we are talking about a personal policy, then it can not be applied.
The principle of action is as follows: an accident occurred and there is a culprit. The car of the victim is insured according to hull insurance.He turns to the company where he acquired the policy in order to receive payment. According to the law, no one can restrict his rights to this. He turns to the insurer, and not to the guilty party, receives his compensation according to the contract. Then, when the company provides it to him, she receives the right to compensate for the damage that was caused by the culprit. Thus, instead of the injured party, we get a CASCO insurer.
Similarly, subrogation can be applied to other property. For example, you insure the repair of the premises in case of damage. On the one hand, you can claim damages from the neighbors who caused it, or use your policy. First, the insurance company will pay you the required funds, and then, according to the rights of subrogation, present the relevant requirements to the perpetrators of the case, thereby preserving their assets.
Regression Features
In insurance practice, this concept is used as the right of the reverse requirement of the company to the culprit of the incident. Despite the fact that they are exempted from the compensation of the damage inflicted upon the injured party to the required extent, they are nevertheless obligated to pay the expenses incurred by the company.
A similar right may be applied in such cases as:
- intentional harm to the health and life of the insured;
- property damage;
- causing losses while driving while intoxicated or intoxicated;
- if the citizen did not have the right to the means during the management of which the insured event occurred;
- when hiding from the scene of an accident;
- if the culprit of the incident was not indicated in the insurance contract as a person admitted to transport management;
- when the accident happened in a period not stipulated by the agreement of the obligatory policy.
Subrogation and Compensation
It is worth noting that the cost of AutoCASCO cannot be greater than the amount that was paid to the policyholder. The issue of compensation for damage to subrogation is considered mandatory, taking into account the wear and tear of interchangeable car parts. This binding right is declared in the relevant article of the Civil Code.
Subrogation compensation in the form of a claim may be challenged, but it is strictly forbidden to ignore the claim.
What to do when you receive a notification
If the insurance company has filed a claim for damages by subrogation as the guilty party, everything must be done within the framework of the rules that govern the relationship between the two parties.
You should wait until the victim passes all the documents and evidence to the appropriate structure, which can be used to determine guilt. In cases where he renounced his claims on the person who is responsible for the losses incurred that were reimbursed by the insurance company, then she should not pay him reimbursement and may demand a refund if payment has already been made.
Statute of limitations
There are also terms for such a procedure as recovery of damage in a subrogation order from the guilty party.
A similar period in this case means the period during which the company has the right to demand the payment of the required amount of the one who caused the insured event.
If we are talking about vehicles and road safety, then the limitation period is three years. This applies to CTP and CASCO.
When the defendant does not make itself felt during this time, the claim can be satisfied even after the period ends. Litigation on subrogation under CASCO and compulsory motor liability insurance is confirmation of this.
Resolution of issues
Very often, the question may arise as to whether the requirements of the insurer should always be satisfied, which in the statement of claim in the order of subrogation, he presents to the citizen who caused the harm.The courts will also consider whether the funds can be paid to them in the amount of the declared compensation, or whether it can be reviewed. As mentioned earlier, the subrogation penalty should be reviewed based on the depreciation of the property, if the amount was previously paid off without taking into account this point. It is worth paying special attention to this.
If in court it is necessary to appeal this or that moment, it should be remembered that the amount of recovery is agreed in the insurance contract, and the party that became the culprit is not its participant. That is why this document may initially not take into account the cost of losses, taking into account depreciation of property, but it is better to prescribe this nuance in it.
Based on the subrogation procedure, the insurance company, within the limits of the funds paid, receives the right of claim that the beneficiary had previously put forward to the offending party of the incident.
Therefore, relations with the person responsible for losses should be governed by the same legal standards that are used when communicating with the injured party. Accordingly, if a potential culprit wants to challenge the cost of compensation on the basis of depreciation of property, he should be given such an opportunity and this is completely legitimate his desire.
Subrogation litigation at CASCO
In this case, absentee proceedings are most often used. That is, the insurance company does not call the culprit of the incident in the judiciary, but is limited to sending a claim in which he is invited to voluntarily make a reimbursement in subrogation order indicating the cost.
Moreover, as a rule, he receives such a notification not immediately, but after a few years (usually within 2–2.5), a person by this time may no longer remember that this or that accident occurred through his fault, if Of course, it was not too large-scale and catastrophic.
However, he is obliged to decide how reasonable the amount of foreclosure is. He can appeal it or agree with the insurance company to make installment payments and here in most cases they meet him.
Sometimes a qualified lawyer helps to reduce the cost of payments and solve the loan issue. By the way, most insurance companies are not interested in litigation of this magnitude, therefore, if possible, they will allow the culprit of the incident to pay the debt in parts and reduce its amount.
So, if you received such a notice asking to pay for subrogation funds, then you should not be nervous, especially if you have nothing to do with accidents and other incidents. Probably, scammers just want to deceive you, hiding behind the name of an insurance company. In this case, you should be very careful and be able to protect your rights.
