Subrogee vs. Subrogor — What's the Difference?

Subrogee and subrogor are terms primarily used in the insurance and legal fields, particularly in the context of subrogation. Subrogation is a process where one party (subrogee) steps into the shoes of another (subrogor) to claim compensation from a third party responsible for a loss. The subrogee is often an insurance company that has paid for the loss and seeks to recover the amount from the party at fault. On the other hand, the subrogor is the insured party who originally suffered the loss and had the right to claim compensation but has transferred this right to the subrogee.

Subrogees, by assuming the rights of subrogors, actively pursue recovery from the responsible third parties. This process not only allows subrogees to recoup losses but also indirectly benefits subrogors by not having to engage in the recovery process themselves. Whereas subrogors, having transferred their claim rights to subrogees, are effectively relieved from the burden of pursuing compensation, which can be both time-consuming and costly.

The relationship between subrogees and subrogors is established through the principle of indemnity, which aims to prevent the insured from profiting from the insurance coverage. Subrogees step in to ensure that the principle of indemnity is upheld by seeking reimbursement only up to the amount of the loss covered. Meanwhile, subrogors are protected from the risk of double recovery, which would violate the principle of indemnity, by having transferred their rights to pursue further compensation.

The process of subrogation highlights the proactive role of subrogees in the legal pursuit against third parties at fault. It emphasizes the subrogee's legal and financial responsibilities in recovering the amounts paid out. In contrast, subrogors, having been indemnified by their insurance policy, play a passive role during the subrogation process, having already been compensated for their loss.

The interaction between subrogees and subrogors underscores a mutual benefit: subrogees recover the amounts paid out, and subrogors are spared the complexity of legal actions. This symbiotic relationship ensures the efficiency and effectiveness of the indemnification process, where the financial burden of losses is ultimately borne by those responsible for causing them.