When you're injured in a car accident, health insurance often steps in to pay for your medical bills after your PIP has been exhausted. However, if you later receive a settlement or award from the at-fault driver, you may be required to reimburse your health insurance carrier for the accident-related bills they covered. This process, known as subrogation, is a critical aspect of personal injury claims that every claimant should understand.
As an experienced Utah car accident lawyers, we’re here to explain how reimbursement obligations work and how to navigate them effectively.
Subrogation is a legal principle allowing your health insurance company to recover the money they paid on your behalf if you receive compensation for the same bills from a third party. In the context of car accidents, this typically means your health insurance company has the right to seek reimbursement from your settlement or verdict.
For example, if your health insurance carrier paid $10,000 for your medical treatment after a car accident, and you receive a $50,000 settlement from the at-fault driver, the insurer may assert a claim against the settlement for the $10,000 they covered. This is because part of that $50,000 is intended to pay for the accident-related medical bills you incurred.
Reimbursement is required to prevent "double recovery," which occurs when a claimant is compensated twice for the same damages. Health insurance policies and federal laws, such as the Employee Retirement Income Security Act (ERISA), often include clauses granting the insurer the right to recover funds they advanced for accident-related medical expenses.
If you fail to reimburse your health insurer, they may take legal action to recover the money or deny coverage for future claims. If you have a government health insurance carrier (Tricare, Medicare, Medicaid, etc.) the penalties can be significant.
Subrogation claims can significantly impact the amount of money you take home from a settlement. For instance, if your settlement is $50,000, and your insurer asserts a $10,000 subrogation lien, you’ll have less money available to cover other damages, such as lost wages or pain and suffering.
However, an experienced Utah car accident lawyer can help negotiate with health insurers to reduce the reimbursement amount, ensuring you retain more of your settlement.
While subrogation cannot always be avoided, there are ways to minimize its impact:
Reimbursement obligations can complicate your personal injury claim, but understanding your rights and responsibilities is essential. An experienced Utah car accident lawyer can guide you through the process, protect your interests, and negotiate with insurance companies to ensure the best outcome.
If you’ve been injured in a car accident and have questions about subrogation or any other aspect of your case, contact True North Injury Law today at 801-849-3664. Our team is dedicated to helping Utah residents navigate personal injury claims with confidence.
