Antisubrogation

Antisubrogation is a legal concept describing rules or contract provisions that limit or prohibit an insurer’s right of subrogation—the process by which an insurer that has paid a claim may pursue recovery from a third party responsible for the loss, or from other parties connected to the insured. Subrogation serves to shift the financial burden back to the party at fault, but antisubrogation rules restrict that recovery in specified circumstances.

Antisubrogation typically appears as explicit clauses in insurance policies or in related contracts. These clauses may bar subrogation against particular parties (such as the insured or co-insureds), against certain contractors or entities, or in specific contexts. They are common in general liability policies, workers’ compensation arrangements, and certain construction or commercial agreements, where the aim is to preserve the insured’s relationship with other parties or to allocate risk in a particular way.

The policy rationale for antisubrogation is to prevent double recovery, protect indemnities provided by contracts or regimes with no-fault elements, and maintain stable commercial relationships. By limiting subrogation, insurers may lower disputes over recovery and support more predictable settlements, though at times this reduces the insurer’s ability to recoup costs from a negligent third party.

Enforceability and scope vary by jurisdiction and policy language. Courts generally honor clear antisubrogation clauses when they do not contravene public policy or statutory requirements. However, antisubrogation rules may be defeated by rules that preserve a party’s rights to recover in certain fraud, intentional acts, or where public policy supports recovery against responsible third parties. As always, the exact effect depends on contract terms and local law.