Did you know that traditional debt collection is only 3% of Viking Client Services’ business? The majority of our work is subrogation, which may be an unfamiliar idea to the everyday consumer. Subrogation is a term often used in the auto insurance industry, but what does it mean? Is it different from collections?
Here are some of the basics you should know about subrogation, collections, and how Viking Client Services works in these areas.
What Does Subrogation Mean?
Subrogation is a legal right held by most insurance carriers to pursue a third party that caused loss to the insured. In simpler terms, it’s a way to protect you and your insurance company from having to pay for an accident that you didn’t cause. Subrogation can occur in property, casualty, and healthcare policy claims, but it is most common in auto insurance.
How Does Subrogation Work?
Your insurance covers you in the event of an accident, whether it’s auto repairs, medical expenses, or other damages. In the case that the accident was not your fault though, your insurance can petition to be compensated by the insurance of the at-fault driver. A subrogation claim allows the insurance companies to settle directly with one another, so the at-fault insurance can reimburse the victim’s insurance (including deductibles).
As the policyholder, most of this work happens behind the scenes, meaning there isn’t much that you need to do. The insurance companies do the work of figuring out who needs to pay for what. You will usually receive your payment from your insurance promptly while they work out the subrogation claim behind the scenes to make themselves whole.
What is a Waiver of Subrogation?
You may have also heard of something called a waiver of subrogation. This is an agreement type of agreement that you can choose to sign as the victim of the accident. This prevents your insurance company from acting on your behalf to collect a payment from the insurance of the driver at fault. Usually, a waiver of subrogation comes into play when the driver at fault wants to take your insurance company out of the picture and only work through their insurance.
Most of the time, it is not in your best interest to sign a waiver of subrogation. It’s also important not to sign anything until you’ve first spoken to your insurance company. Many insurance companies want you to notify them before you sign a waiver of subrogation, and some insurance companies may even prevent you from signing one altogether.
How is Subrogation Different from Collections?
Subrogation is not traditional debt collection, though it is sometimes considered a form of collection or recovery. Debt collectors and agencies typically collect consumer debts that are past their due date. A subrogation claim is generally considered a “tort,” not a “debt.” A tort is defined as an action that causes harm to another person or their property, whether caused by accident or on purpose.
What Does Viking Client Services Do?
Viking Client Services works in subrogation, claims, and collections. Today, the vast majority of our work is directly related to rental car companies and car insurance companies, not traditional debt collection. We are passionate about solving complex problems through skilled communication and collaboration. As a company that’s committed to doing good and being compassionate toward people, we are proud to make a difference in the world of business-to-business subrogation claims.
