When an employee is injured on the job in California, he or she will generally bring a workers’ compensation claim. That injured worker may also have an additional claim—such as against a negligent third party that contributed to their accident. In these cases, complex issues related to subrogation can arise. California Insurance Code § 11662 regulates these subrogation cases. Here, our Pasadena workers’ compensation defense attorney discusses the key points to know about insurance subrogation and Section 11662.
What is Subrogation?
To start, it is useful to understand the basics of insurance subrogation. Simply defined, subrogation is the legal process through which an insurance company steps into the place of the insured and recovers costs from a third party. Put another way, after an insurance company pays out benefits under a policy, it acquires the right to seek reimbursement from those at fault.
How Subrogation Can Impact a Workers’ Compensation Claim in California
Why does subrogation matter for workers’ compensation in California? Benefits are paid on a no-fault basis to injured workers. If a person is hurt on the job, they have a right to bring a workers’ compensation claim. However, in some cases, injured workers will also have an additional claim against a negligent third party. The workers’ compensation insurer may obtain subrogation rights against that third party.
For instance, imagine that a construction worker in Fresno is injured on the job due to faulty equipment provided by a third-party vendor. The construction worker files for no-fault workers’ compensation benefits through their employer. That insurance covers his medical bills and part of his lost wages. The construction worker also eventually recovers compensation through a negligence claim against the third-party vendor. Through subrogation, the workers’ compensation insurer could take action to recover its costs from the compensation obtained through the third-party liability claim.
Understanding California Insurance Code § 11662
California Insurance Code § 11662 plays a key role in regulating subrogation efforts within our state’s workers’ compensation system. The statute outlines the specific conditions and procedures under which an insurer can execute its subrogation rights. Most notably, Section 11662 mandates that the insurer must provide written notice to the injured worker before proceeding with a subrogation claim. The provision is designed to ensure transparency and gives the injured worker an opportunity to be involved in the process. Beyond that, Section 11662 sets forth a process for the allocation of recovered funds. It prioritizes the reimbursement of the worker’s legal costs and expenses before the insurer can claim the remaining amount.
Consult With a Workers’ Compensation Defense Lawyer for Help With Subrogation
At Yrulegui & Roberts, our California workers’ compensation defense attorneys have the skills and experience to handle complex subrogation cases. If you have any questions about insurance subrogation in a workers’ compensation claim, please do not hesitate to contact us today for your strictly confidential, no-obligation case review. With offices in Fresno, Bakersfield, Sacramento, and Pasadena, we defend workers’ compensation cases throughout the area.
