Definition - What does Subrogation Clause mean?
A subrogation clause is a common clause in insurance policies that states that the insured gives their insurance company the right to sue a third party for insured losses on their behalf. This way, the insurance company a means to recover the claim paid to the insured for the loss. Generally, the process all happens behind the scenes without your involvement.
Insuranceopedia explains Subrogation Clause
For example, if a third party causes an accident that totals your car, your insurance company compensates you for the loss and receives the right to sue the at-fault party on your behalf. Some companies reimburse your deductible depending on the amount won in the claim.