13.8 Subrogation

• Library: Insurance Law in Virginia (Virginia CLE) (2020 Ed.)

13.8 SUBROGATION

13.801 The Existence of the Right. Section 38.2-2105 of the Virginia Code, which sets forth mandatory language for all fire insurance policies issued in Virginia, provides:

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Subrogation. This company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefor is made by this Company. ³⁸⁵

13.802 Limitations upon the Right. Although the language of the policy purports to give the insurer unfettered latitude to pursue the entity responsible for the damage, there are restrictions. Equity will preclude an insurer from asserting its subrogation rights against a coinsured, even if that coinsured was negligent and caused the loss. ³⁸⁶ Moreover, the insurer's rights as the subrogee of its insured cannot exceed the rights or claims that the insured had against the responsible entity, and the insurer's claim is subject to any defenses that could have been...