The right of subrogation is an important system in the Insurance Law, the core of which is that when the insurer pays the insurance money to the insured, it replaces the position of the insured within the scope of the compensation amount and recovers from the third party who caused the loss. The purpose of this system is to prevent the insured from receiving additional benefits as a result of the occurrence of an insured event and to ensure that the responsible party is held liable for the losses caused by it.
In China, the exercise of the right of subrogation is not unconditional, but must meet certain legal conditions. These conditions ensure the reasonableness and fairness of the right of subrogation, and at the same time protect the legitimate rights and interests of all parties. The exercise of the right of subrogation is subject to the following three conditions:
This is a prerequisite for the right of subrogation. The occurrence of the insured accident must be caused by the act of a third party, and the insured has the right to claim compensation from the third party. Such claims may be based on tort, breach of contract, or other legal provisions. For example, in vehicle insurance, if the insured's vehicle is involved in an accident due to the fault of a third party, the insured has the right to claim damages from the third party.
The term "third party" here refers to any person other than the insurer and the insured. Moreover, the insured's right to claim damages against a third party must have existed at the time of the occurrence of the insured event, and not after the occurrence of the insured event.
This is a substantive condition for the right of subrogation. The insurer must have paid the insurance money to the insured in order to obtain the right of subrogation. This is because the essence of the right of subrogation is an assignment of creditor's rights, that is, the insured transfers its right to claim damages against a third party to the insurer. The premise of such assignment of claims is that the insured has received compensation from the insurer.
It should be noted that the insurance premium paid by the insurer must be within the scope of the insurance liability, and the amount paid must be clear. If the insurer has not paid the premium or the amount of the payment is not clear, the right of subrogation cannot be exercised.
This is the scope condition of the right of subrogation. The insurer can only exercise the right of subrogation within the scope of the insured amount paid, and cannot exceed this range. This is because the purpose of subrogation is to prevent the insured from obtaining additional benefits, not to give the insurer additional benefits. Therefore, the insurer cannot obtain a benefit in excess of the sum insured paid by exercising the right of subrogation.
However, if the third party is fully responsible for the occurrence of the insured event, the insurer may exercise the right of subrogation in full up to the sum insured paid. However, if the third party is only partially responsible for the occurrence of the insured event, the insurer can only exercise the right of subrogation in accordance with the corresponding proportion.
1.If the insured waives the right to claim compensation from a third party before obtaining compensation from the insurer, the insurer shall not be liable for compensation of the insurance money. This is because the insured's waiver of the right to claim compensation against a third party will result in the insurer being unable to exercise the right of subrogation, thereby increasing the insurer's risk.
2.After the insurer has compensated the insured, the insured waives the right to claim compensation from a third party without the consent of the insurer, the act is invalid. This is because the insured has already transferred its right to claim damages against a third party to the insurer after receiving compensation from the insurer, and therefore has no right to waive it.
3.If the insurer is unable to exercise the right of subrogation to claim compensation intentionally or due to gross negligence, the insurer may deduct or demand a refund of the corresponding insurance money. This is because the insured's actions have resulted in the insurer's inability to exercise the right of subrogation, thereby increasing the insurer's losses.
To sum up, the exercise of the right of subrogation needs to meet certain statutory conditions, including the insured's right to claim damages against a third party, the insurer has paid the insurance money to the insured, and the amount of the subrogation right is limited to the insured amount paid. These conditions ensure the reasonableness and fairness of the right of subrogation, and at the same time protect the legitimate rights and interests of all parties. In practice, the insurer and the insured should strictly abide by the relevant laws and regulations to ensure the correct exercise of the right of subrogation.
The above analysis is for reference only, as the legal issues involved in the right of subrogation are complex, if you need a more professional interpretation, it is recommended to consult a senior legal expert.