Principle of subrogation

Subrogation means the restitution of the rights of an assured in favour of the insurer against the third party for any damages caused by him in place of the assured after the insurer has indemnified him for the loss. The principle of subrogation is invoked when a third party is responsible for the loss. It is to be noted that on the happening of the event for which the asset has been insured and after the damage has been caused the insured can sue the party who has caused the damage to claim compensation for the loss.