TOPIC INSURANCEByron Koukaras

PAT Bedara

Summary Of Case

Appeals court held that it would not be in the interest of equity to require a houseguest to be liable to an insurance company that paid for the loss suffered by the homeowner due to a fire started by the negligence of the houseguest. There is no right of subrogation in such instance.

Key Words

Subrogation: The substitution of one person or group by another in respect of a debt or insurance claim, accompanied by the transfer of any associate.

Houseguest: A guest entertained in your house.

Decision

Reversed subrogation clauses in homeowners insurance policies state that the insurer may require an assignment of rights of recovery and that the insured must cooperate. It is a concept rooted in doctrines of equily and applied by operation of law.