Page 35 - M1_Insurance Introduction Notes

that is taken over by the insurer through the

policy.

 Subrogation –

The insured’s right to claim from anywhere else is

taken over by the insurer when he pays a claim.

Since the insurer has paid the amount of loss to

the insured, the insurer would be the one who has

borne the loss. Hence, the name of the insurer

should be substituted for the insured and the right

to recover the amount of loss from the person

causing loss has to be transferred to the insurer

who paid for the loss and compensated the

insured. This taking over of the insured’s right by

the insurer is called ‘subrogation’ in insurance

phrasing. In other words, on payment of the claim,

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