Our plaintiffs’ personal injury lawyers frequently receive calls from defendants who have been involved in an auto accidents who do not understand why they are being sued by an insurance company as a result of an auto accident they had with an individual in which no one was injured. Although our lawyers do not handle these cases, we explain to these people the concept of subrogation law in Maryland. Most people involved in an auto accident in Maryland do not realize that if they do not have auto insurance and the accident is their fault, the other party’s insurance company can sue them for the money it paid out in property damage. Many of these callers are surprised when, years later, they receive suit papers for an auto or truck accident in which no one sustained a personal injury, yet they are being sued for thousands of dollars. The insurance company is exercising its right to subrogation, which literally means the insurance company is substituting itself for the actual party involved in the auto accident and collecting the money for the damage done to that individual’s property (for which they have already paid pursuant to their insurance contract with that person).
We usually recommend a competent Maryland attorney for these people. The problem, of course, is that the amount of damages are often such that it does not make economic sense to involve a lawyer. If the callers do not want to get a lawyer, we usually advise them to contact the insurance company’s lawyer and try to negotiate a settlement. The insurance company’s lawyer is usually authorized to accept pennies on the dollar to settle these cases in an effort to save the insurance company the time and effort of trying to collect a judgment it obtains.