If you are involved in a car accident and your car is damaged through the negligence of another driver, you can claim from your own insurance company. However, once your insurance company has settled your claim they will endeavour to recover the full payment made to you (including your excess) from the other party. Subrogation is the name given to this process of payment recovery.

As an innocent party you have a legal right to sue the negligent driver, but in the case of subrogation that legal right now passes (is transferred) to the insurance company who can sue on your behalf.  The word subrogation originates from the Latin word “subrogare” – it means to “stand in the place of.” This legal right of subrogation is included in all short term insurance contracts.

In insurance a fundamental rule is that you should be placed in the same position you were in before suffering the loss, not in a better position. You therefore cannot receive payment from your insurer and still claim from the guilty party as the rule of subrogation has now legally transferred your rights to the insurance company. If the guilty party has no insurance himself he can be sued in his personal capacity. This again, highlights the importance of having sufficient car insurance.