Subrogación

Subrogación is a legal concept, primarily found in civil law jurisdictions, that refers to the substitution of one person or entity for another in a legal right or obligation. In essence, it allows a third party to step into the shoes of a creditor and assume their rights against a debtor. This typically occurs when a third party pays a debt owed by another. Upon payment, the third party acquires the creditor's rights, including any collateral or security that was attached to the original debt.

The most common application of subrogación is in insurance. When an insurance company pays out a claim to its policyholder for damages caused by a third party, the insurer is usually subrogated to the rights of the policyholder against that third party. This means the insurer can then pursue the at-fault party to recover the amount it paid out. For example, if a driver's car is damaged in an accident caused by another driver, their insurance company, after paying for repairs, can subrogate against the at-fault driver or their insurance to recoup the costs.

Another context for subrogación is in mortgage lending. If a new lender pays off an existing mortgage on a property, they can be subrogated to the rights of the original lender. This ensures that the new lender's interest in the property is secured, even if the original mortgage documents are not formally transferred. Subrogación is designed to prevent unjust enrichment and ensure that the party ultimately responsible for a loss bears the financial burden. It is a mechanism that transfers rights and remedies from one party to another under specific legal circumstances.