The aim of doctrine of subrogation is that the insured should not get more than the actual loss or damage.
After payment of the loss, the insurer gets the light to receive compensation or any sum from the third party from whom the assured is legally liable to get the amount of compensation.
The main characteristics of subrogation are as follows:
- The insurer subrogates all the remedies fights and liabilities of the insured alter payment of the compensation.
- The insurer has right to pay the amount of loss after reducing the sum received by the insured from the third party.But in marine insurance the right of subrogation arises only after payment has been made, and it is not customary as in fire and accident insurance, to alter this by means of a condition to provide for the exercise of subrogation rights before payment of a claim.At the same time the right of subrogation must be distinguished from abandonment. If property is abandoned to a marine insurer, he is entitled to whatever remains to the property irrespective of value of subrogation.
- After indemnification, the insurer gets all the rights of the insured on the third parties, but insurer cannot file suit in his own name. Therefore, the insured must assist the insurer for receiving money from the third party.If the insured is revoking from filing suit against the third party, the insurer can receive the amount of compensation from the insured. It is corollary of principle indemnity.