McKayla Girardin, Car Insurance Writer
You would want a waiver of subrogation if you were the at-fault party in a serious and expensive accident, especially if you are uninsured. A waiver of subrogation allows the at-fault driver to pay a small settlement for the damage they caused and prevents the injured party’s insurer from suing for the full claim amount. While this is good for the at-fault driver, this ultimately prevents the injured driver from being able to recover any future costs that may arise from the accident.
Waivers of Subrogation for Injured Drivers
As the injured driver after an accident, signing a waiver of subrogation is usually not a good idea. In fact, your insurance policy may even forbid you from signing a subrogation waiver.
Subrogation allows injured drivers to have claims paid out quickly since their insurance company knows they can recoup the costs from the at-fault driver. By signing a waiver, you are blocking your insurer from recouping those costs. Additionally, subrogation keeps premium costs lower for good drivers as the financial burden can be shifted to drivers who cause accidents.
Waivers of Subrogation Outside of Car Insurance
For business owners, your clients may request waivers of subrogation so they can avoid being held liable if they are at fault for any losses. However, signing a waiver of subrogation with a client may lead to you losing the ability to recover costs after a loss-causing situation. In general, waivers of subrogation minimize the number of lawsuits and claims filed by parties in a contractual agreement.
To learn more, check out WalletHub’s guide to subrogation.
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