Marine Insurance: Law and Practice
SUBROGATION AND RECOUPMENT
The “doctrine of subrogation”
The underlying purpose of a contract of indemnity insurance is the provision of an agreed indemnity to an assured for a loss. The “doctrine of subrogation” is often used to describe a series of related legal principles which can be best understood as having two major functions. The first is to prevent the assured from being over-indemnified under the contract of insurance for the loss insured against, at the expense of the insurer. The second is to facilitate recoupment of the insurer for the indemnity paid to the assured—often, though not invariably, at the expense of the party responsible for causing the loss.