Subrogation is a legal doctrine that allows an insurer to "step into the shoes" of its insured to recover proceeds paid by suing a third party responsible for the loss. Subrogation is particularly important in determining how losses are allocated in multiparty automobile accident cases. 

When multiple insurers are involved — such as a victim’s health insurer, their automobile insurer and the at-fault driver’s liability insurer — subrogation allows one insurer to seek reimbursement from others that may also owe a payment. Each insurer with subrogation rights may assert a claim against the at-fault party or their insurer, often resulting in negotiations to resolve competing claims. 

For example, if the injured party’s health insurer pays medical expenses upfront, it may seek repayment from the at-fault driver’s insurer once a liability settlement is reached. Similarly, if the victim’s own automobile insurer pays out uninsured/underinsured motorist (UM/UIM) benefits, that insurer may pursue reimbursement from the at-fault party.

The injured party may face a reduced recovery because insurers asserting subrogation rights often claim portions of any settlement or judgment. Connecticut law attempts to balance these competing interests through equitable principles, requiring that subrogation claims not unjustly diminish the injured party’s ability to recover.

Connecticut’s collateral source rule plays a significant role in determining an accident victim's ultimate recovery of damages. A jury considering damages is not told about compensation received by the victim from insurance or other sources. However, after the jury awards damages, the court must reduce the award by the amount of collateral source funds, except for amounts attributable to premiums paid by the plaintiff or their family. This rule is meant to avoid the plaintiff being overcompensated but it also recognizes that plaintiffs are entitled to the insurance benefits for which they have paid.

Collateral sources may include health insurance, disability insurance and other private coverage, such as personal injury protection (PIP) from the plaintiff’s own auto insurance policy. They include workers’ compensation benefits for accidents occurring on the job, and public health insurance benefits like Medicaid and Medicare.

In practicality, plaintiffs may seek a higher settlement to mitigate the rule’s effect. With the assistance of a qualified personal injury attorney, plaintiffs can gather and present evidence to demonstrate the full extent of their injury-related damages, which can help drive their claim for a higher settlement.

Gesmonde, Pietrosimone & Sgrignari, L.L.C. in Hamden and East Haven represents Connecticut residents who have been injured in accidents caused by other people’s negligence. Please call 203-745-0942 or contact us online to set up a meeting with one of our attorneys.