Subrogation is based on the principles of negligence and tort, or better understood as “someone else is at fault and they should pay for it.” Workers compensation adjusters who are cross-trained as liability adjusters seldom miss the opportunity to pursue subrogation against another party. Unfortunately, in today’s insurance world, most workers compensation adjusters are specialists in work comp and have little, if any, background in liability claims. This results in the work comp adjusters often missing subrogation opportunities.
With the financial aspect of subrogation, you would think the insurer or self-insurer would carefully search for subrogation opportunities. However, when the work comp adjuster is reviewing the file, if they do not understand tort law, they will not recognize the potential for subrogation. Unfortunately, the work comp adjuster’s supervisor or claims manager will often not recognize subrogation either, as their claims background and expertise is in workers compensation, not liability claims or tort.
To find the missed subrogation opportunities, the workers compensation claims office should bring in an outside, independent claims auditor who has both an extensive background in work comp claims and an extensive background in liability claims. It takes this dual knowledge to perform a subrogation audit successfully.