Insurance · Adjuster Basics and Licensing

What is 'subrogation' in insurance?

Correct answer

The insured transfers their right to recover from a third party to the insurer after the insurer pays the claim

  1. A A discount for long-term policyholders
  2. B The insured transfers their right to recover from a third party to the insurer after the insurer pays the claim
  3. C A reduction in the insured's premium for no claims
  4. D A provision allowing payment in installments

Why this is the answer

Subrogation: after paying a covered claim, the insurer 'steps into the shoes' of the insured to recover from the responsible third party. This prevents the insured from collecting twice (from insurer AND the at-fault party). The insured must cooperate with subrogation proceedings.
Source: Adjuster Exam, Subrogation

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About this topic: Adjuster Basics and Licensing

Adjuster basics cover the types of adjuster (staff, independent, public), licensing and continuing-education requirements, the adjuster's duties to the insurer and the insured, and the stages of a claim from first notice to closure. This is one of 9 Insurance Adjuster questions on adjuster basics and licensing, each with a full explanation on a single study page.

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