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What is the statute of limitations on subrogation in IN for an auto insurance company to recover money?

Indianapolis, IN |

I was in an auto accident and the other driver was uninsured. The insurance company paid money to my finance company. I am in the middle of a court case where I may be able to collect a judgement in regards to this accident. The other driver's lawyer is stating that the insurance company will come after me for the money if I don't settle with them. The lawyer is going to contact the insurance company to advise that I have received money so they can recover the money back from me and not his clients. I believe this is just a scare tatic to get me to settle for less than the amount being asked for.

Attorney Answers 4


Subrogation is a contractual right of recovery. It says, if you collect money from third party based on medical treatment for which we have paid for, you have an obligation to reimburse us. The obligation remains in full force until you collect and get paid. So, whenever payment to you occurs, your obligation comes to life.

If you do not have an attorney you need one. Because there are ways to minimize the payment pursuant to subrogation right of recovery. Further, what the lawyer is telling is inaccurate and sound like blackmail to me. You need to consult with an attorney and find out whats what.

I hope this helps-

Nima Taradji

Disclaimer: I am a lawyer licensed in the State of Illinois only, and I am not your lawyer (unless you have been in my office and signed a contract). This communication is not intended as legal advice, and no attorney client relationship results. Please consult your own attorney for legal advice. This is for entertainment purposes only.

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There are a number of issues here, first your primary question:
Subrogation is traditionally an equitable basis for recovery, although these days it is generally a matter of the contract which you have between you and your insurance company.

The statute of limitations may depend on under which basis the insurance company is attempting to recover. As the name suggests, most states will have a particular statute or code provision which describes the applicable limitations period. In Washington, for example, there is one statute of limitations for oral contracts (3 years) and another for written contracts (6 years), neither of which begin to run until the BREACH of those contracts (again, in Washington).

In this case, the applicable period is governed by statute and is probably the written contract SOL, IF the basis for which your insurance company could "come after you" is found in a written contract between you and them, and it may only begin to run from the date they first request their subrogation interest.

Most states have some sort of 'made whole' language, which requires that the injured party be made whole before their insurer's subrogation interest is triggered. Your insurance company has no legal interest in acquiring subrogation money from you UNLESS you acquire money from the third party. Now, if you acquire money from the third party, you may have a subrogation amount which you need to repay...but only if you receive that money.

If true, the other driver's lawyer is arguably breaching ethical rules in attempting to browbeat you into settling for some lesser amount. This is not a typical - or particularly classy - tact, but hardly unheard of.

Consult with a personal injury attorney; and not just someone who does so part-time, but someone who emphasizes pi/insurance law. You should be fine.

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I will preface this by stating that the laws in your area are most likely different from those which I practice under. Therefore, I should tell you that I am unfamiliar with those laws.

That said, i would concur that the obligation is that of a contractual nature. The Statute of limitations (at least in FL) would begin to run from teh date of your obligation (most likely the date you collect money). the question would then become, what is the statute of limitations in your area for a contractual claim?

I strongly recommend you contact an attorney to discuss this matter in further detail, so as to allow you to get more accurate advice, and to do so without haste. The above is not intended to form a legal relationship and is for informational purposes only rather than legal advice.

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In reviewing the other answers here, I would supplement my previous response to say that I strongly urge the asker (and all others in a similar position) to consult with an attorney in your local jurisdiction. Here, there are responses from Florida, Illinois and Washington, in response to an Indiana question. Two of the responses state only that subrogation is contractual in nature. In one sense, it certainly is, BUT your obligation to honor the insurance company's subrogation interest may be grounded in certain equitable rules NOT based in contract law, which I alluded to earlier. These depend, largely (ERISA notwithstanding), on your state rules and case law regarding subrogation. Subrogation is to be distinguished, generally, from reimbursement. In Washington, for example, the insurance company is not entitled to a dollar-for-dollar reimbursement of the amount which it paid out. This is a creature of case law, again in Washington, and not the contract between the insurer and the insured.

Consult with an Indiana attorney at your earliest possible convenience.

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