In Wilson v. Educators Mut. Ins. Ass’n, 2017 UT 69, the Supreme Court of Utah considered whether an insurer had the right to bring a subrogation action in its own name despite the fact that its insured had not yet been made whole. The court held that, although the common law made whole doctrine generally bars an insurer from proceeding in its own name until after the insured has been made whole, the terms of an insured’s insurance policy can change the made whole doctrine. The Wilson case highlights the importance of reviewing the applicable insurance policy, in conjunction with the law of the applicable jurisdiction, to determine an insurer’s subrogation rights. Continue reading
When an insurer files a subrogation suit in the insured’s name, questions often arise with respect to whether, by doing so, the insurer has to respond to discovery issued to the insured. In Aquatherm, LLC v. Centimark Corporation, 2017 U.S. Dist. LEXIS 85173 (C.D. Utah June 2, 2017), a case in which the insurer at issue made the insured whole, the District Court for the District of Utah answered the question in the negative. Continue reading
For subrogation professionals, it is important to limit the liability exposure of your insured. In cases where the insurer, as subrogee, is proceeding as the plaintiff, this means limiting any direct claims against the insured – whether for contribution or indemnity – to affirmative defenses as opposed to third-party claims. Limiting direct claims against insureds not only keeps captions clean, but avoids strategic maneuvering by the defense that could negatively impact your case. In Ohio, when a defendant tries to pursue direct claims against the insured for contribution or indemnification, practitioners should, consistent with the analysis set forth in Continental Casualty Company v. Equity Indus. Maple Heights, LLC, 2017 U.S. Dist. LEXIS 54440 (N.D. Ohio, April 10, 2017), argue that defendants can no longer attempt this maneuver and that they are limited to raising affirmative defenses against the plaintiff’s subrogor.
When an insurer, as subrogee of its insured, files suit against a defendant to recover its subrogated payments, the defendant, not infrequently, files a third-party complaint against the insured. Typically, the defendant alleges that, if it is liable, then the insured, based on his or her contributory negligence, is liable to the defendant for contribution. Insureds, however, cannot be liable in tort to themselves.