Subrogation–What it is and Why You Should Care

Posted by Craig F. Schauermann | Jan 13, 2014 | 0 Comments

You really need to know and you really need to care because, often times, “subrogation” will seriously affect the bottom line in your personal injury case.

“Subrogation” is a legal term. It essentially means that someone that has paid you a benefit (like your PIP carrier or Health insurer that may have paid some or all of your medical expenses) related to your accident wants to get its money back out of your settlement. Subrogation can also be called a “lien” or a “right of reimbursement” or a “subrogated interest.” It can have a huge effect on the net amount that you will get at the end of case.

Suppose that you are hit by a drunk driver. You have PIP (personal injury protection) coverage in your policy. Your PIP insurer pays out $10,000 to your medical providers. You settle with the drunk driver's insurer for its policy limits of $25,000. The PIP insurer wants money back. Your attorney wants his or her 1/3 attorney fee and costs. Out of that $25,000 you may only get $6,500 or so if the PIP insurer gets its full $10,000 subrogated interest back.

Some insurers will tell you that they get back all of the money that they paid out on your behalf. Many times they are wrong. They may be entitled to all of it back in a few cases but for the most part they are only entitled to some of it back and on some occasions they get back none at all. Some lawyers (or so we have heard) only are interested in getting the largest settlement that they can get and don't worry about the subrogation claim's against your settlement-they just pay whatever the insurers want. Schauermann Thayer Jacobs Staples & Edwards believes that our job, in addition to settling or trying your claim, is to deal with these companies with their hand out wanting their money back and to get the best deal we can for you so that the net to you is maximized. We do it well. Many times we get them to reduce their subrogated interest. Sometimes we get it eliminated altogether. Remember that hypothetical above. Now suppose that instead:

-your attorney is able to convince your PIP carrier that you are not fully compensated for your injury by the payment of the $25,000. The PIP carrier may then agree to substantially reduce its “lien” or to waive it all together. Instead of only $6,500 in your pocket you get $12,000 or even $16,500 back.

If you have been involved in a motor vehicle collision and your PIP or health insurer is trying to “subrogate” a portion of your settlement proceeds, please feel free to call us. We would be happy to explain this in more detail and or discuss with you other options for the final resolution of your claims.

About the Author

Craig F. Schauermann

Member.  Effective July 1, 2015, Craig Schauermann has transitioned from managing partner of the firm to an “Of Counsel” role with the firm. As a founding partner, along with William “Bill” Thayer, Craig's name will remain with the firm. Craig will continue his long history of mentorship to the firm's attorneys and contribute to the firm's active cases. You may contact him via this page, but he is not taking on new cases directly in his new role with the firm. Location: Vancouver, Washington Phone: 360-558-3766 Fax:               360-696-0583 Contact Craig Schuermann Emphasis: Before going of counsel July 1, 2015, Craig advised and advocated for his clients in personal injury and wrongful death cases for nearly 40 years. He continues to work part time with the attorneys in our office on matters relating to serious personal injuries and wrongful death. Professional Qualifications & Education: Bachelor of Arts, 1973 Washington State University; Juris Doctor degree, 1976 University of Puget Sound; Licensed to practice before all courts in the State of Washington, the Western and Eastern District Federal Courts of the State of Washington, and the Ninth Circuit and the United States Supreme Court. Professional Experience: Craig started work in Seattle as an associate with a small personal injury firm and moved to Clark County in January of 1979. He practiced exclusively after that in the State of Washington, primarily in Clark County. He was instrumental in obtaining for his clients a number of large verdicts, arbitration awards, and settlements. Professional Affiliation: Member of the Board of Governors for the Washington State Trial Lawyers Association from 1996-2001. Political Action Committee for WSAJ from 2004-2015.  Past WSTLA Eagle member for over 25 years. Past President of the Clark County Bar Association. Former Chairman of the Washington State Bar Association's Continuing Legal Education Committee. Craig has been a speaker at numerous legal education seminars. Personal: Craig and his wife are the proud parents of three children and six grandchildren. He enjoys golf, playing bridge, and traveling with his family. Areas of Practice Personal Injuries Wrongful Death Litigation Percentage 100% of Practice Devoted to Litigation Bar Admissions Washington, 1977 U.S. District Court Eastern District of Washington, 1993 U.S. District Court Western District of Washington, 1977 U.S. Court of Appeals 9th Circuit, 1994 U.S. Supreme Court, 1994 Education University of Puget Sound School of Law, Tacoma, WashingtonJ.D. – 1976Washington State UniversityB.A. – 1973 Professional Associations and Memberships Washington State Trial Lawyers Association, Member, Board of Governors, 1996 – 2001 Washington Trial Attorneys Public Forum Clark County Bar Association, Past President Washington State Bar Association, Former Chairman, Continuing Legal Education Committee


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