|Post by Lee Floyd|
- The insured alone may bring the claim: It appears that in most situations the subrogation claim may be brought exclusively in the name of the insured. In South Carolina, an insured is the only proper party to institute a subrogation claim where an insurer has not yet paid for the loss or disputes coverage depending on the outcome of the claim against the third party. While obvious in its reasoning, this rule has important implications: an insurer appears capable of always bringing a subrogation claim solely listing the insured as the plaintiff and still retains control over prosecution of the claim under the terms of the insurance policy. Using this rationale, there is no need to identify the plaintiff as “insurance company X as subrogee of” or similar language.
- The insured and the insurer are both proper parties to the action: This approach has been recognized in South Carolina where an insurer pays only a portion of the insured’s loss due to the actions of the defendant. This rule is consistent with South Carolina’s recognition of equitable subrogation as automatic on a pro-rata basis.
- The insurer may bring the action solely in its own name: An insurer may file a Complaint solely in its own name only where it is has paid the total loss. It is unclear, in South Carolina, whether this requires the insurer to have waived any amount due under the policy for the deductible or if this amount is excluded from calculating the total loss.
While this issue can be overlooked, determining the proper parties to Complaint in a subrogation claim may have significant ramifications on how the claim is presented to a jury and the perceived value of a claim. As it currently exists, South Carolina law appears to permit an insurer to institute a subrogation claim in solely the insured’s name in most, if not all, circumstances. It appears that this approach may be underutilized or overlooked in current practice.