Legal Question in Insurance Law in Colorado
fraud
A person has received full payment from an insurer for physical damage to property that occurred legally -- like a fender bender. But the person tries to receive full payment for damage from a second party through subrogation. Is this seeking double payment, while keeping both parties blind, fraudulent?
1 Answer from Attorneys
Re: fraud
Generally, assertion of subrogation rights does not result in double recovery or violate the collateral source rule; a tortfeasor will still be liable for the damages he caused, even if the injured party's insurance company paid a claim. A subrogated insurance company essentially steps into the shoes of the injured party and can sue the tortfeasor for what it paid out.
If the insured is lying to his carrier or another party, then there could potentially be a claim for fraud or breach of the insurance contract.
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