How Does Subrogation Work in a Personal Injury Claim in Arizona?

Your insurance provider may cover the costs of a personal injury in Arizona while negotiations in a personal injury claim are ongoing. Additionally, you might receive a letter stating they seek reimbursement from the negligent party for the compensation they paid you. This process is known as subrogation, and understanding it provides more knowledge in navigating an Arizona personal injury claim.

When is Subrogation Allowed in Arizona?

Private health insurers are not given subrogation rights in Arizona. Arizona is recognized as an anti-subrogation state, preventing private health insurance companies the right to collect against a personal injury claim. However, some plans are exempt from the subrogation rule:

  • Taxpayer-funded healthcare plans
  • Government-operated health plans
  • Some employee benefit plans
  • Some auto insurance policies

Arizona residents may opt into Medical Payment plans through their auto insurance to cover reasonable medical expenses in an automobile accident. Choosing a medical payment plan to cover injuries caused by a negligent party instead of private health insurance may allow the auto insurance carrier to file a subrogation claim (I) against any settlement received for damages.

Waiving the Right to Subrogation

A policyholder may sign a waiver of subrogation preventing their insurance provider from acting on their behalf to recuperate any expenses from an at-fault party. These waivers may be used when the at-fault party wants to settle damages from an accident without your insurance company becoming involved. Signing this waiver will prevent your insurance company from acting for you should unexpected damages or injuries arise following the settlement agreement.

Risks are involved with these waivers. Most insurance providers require a policyholder to inform them before a subrogation waiver is signed. Because of the complexities of auto insurance and car accident laws, seeking guidance from a Phoenix car accident lawyer is always recommended when working through these details with an auto insurance provider.

Subrogation Benefits

There are advantages to subrogation for the insurer as well as the policyholder. Because the cost of damages in a personal injury claim can be overwhelming, receiving financial compensation to cover your expenses is vital. Benefits of subrogation include:

  • Minimized wait time: Investigating liability in an insurance claim increases the time it takes to receive compensation. There are also no compensation guarantees, which makes accessing a policyholder’s insurance coverage for expenses beneficial when delays in compensation arise.
  • More affordable insurance coverage: An insurance company’s ability to recoup financially for the damages it covers helps to prevent the soaring costs of insurance coverage. Additionally, subrogation is beneficial in combating insurance fraud that would allow an injured party to be doubly compensated from claims filed with their provider and the at-fault party’s insurance.
  • Simplifies the Claims process: The at-fault party’s insurance provider benefits from denying your claim and may do so when a fault is unclear or both parties hold a degree of fault. Seeking compensation from your insurance provider allows you to get the financial help you need while allowing your insurance company to negotiate with the at-fault party’s insurance provider to recover what they have paid you.

The handling of an Arizona personal injury claim will impact its outcome. Recovering your damages helps you get on with life without the tremendous toll of financial debt. Understanding your rights to compensation in a personal injury claim in Arizona is the best place to begin.