What’s subrogation in motor insurance coverage claims?
Within the context of Singapore, underneath the Barometer of Legal responsibility (BOLA) system, a subrogation declare is a declare made in opposition to the primary occasion by the third occasion for the primary occasion half within the accident. Subrogation claims can often have an effect on motorists after they least anticipate it.
For instance, Mr. A was using a motorcycle in 2008 when a saloon automotive knocked into him from behind. Mr. A suffered some minor accidents and in addition damages to his bike. The accident was promptly reported to the authorities and left to the respective insurers of each events to kind out the claims.
Mr. A was very positive that he was not at fault and the incident was forgotten. Nevertheless unknown to Mr. A, though his NCD was not affected, the insurers accorded him a 10% legal responsibility within the accident and the saloon automotive driver 90%. The saloon automotive insurer, Firm A then made a subrogation declare in opposition to Mr. A’s insurer, I Firm for Mr. A 10% within the damages. As his legal responsibility is barely 10%, his NCD was not affected in accordance with BOLA settlement however Mr. A will get a declare historical past of 10% of the injury invoice. Although the 10% solely quantity to $135 for the whole $1350 claims, the declare historical past will have an effect on his automotive insurance coverage premium for the next three years. The subrogation declare will even stick with Mr. A even when he bought his motor bike and bought a saloon automotive.