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I was involved in a car wreck, and my auto insurance carrier paid my medical bills. I sued the other driver regarding the other injuries and damages I incurred as a result of the accident, and now my insurance company wants me to reimburse them for the medical expenses they paid on my behalf. Is that legal?


If you purchased medical payments coverage in conjunction with your automobile insurance policy arising from an automobile accident, it is likely that your policy provides that in the event you seek a compensation from another party or their insurance company arising from a car crash, that your insurance company is entitled to be reimbursed for the medical expenses it paid on your behalf or that of your passengers. The concept entitling your insurance carrier to reimbursement for medical expenses it has paid on your behalf is called "subrogation."

However, regardless of what the insurance policy states regarding its claim for subrogation, you should be aware that there are two concepts that may impact the auto insurance carrier’s claim for reimbursement.

The first concept is referred to as the "common fund doctrine." The common fund doctrine provides that if you hire an attorney to seek damages on your behalf from another party, and your attorney gives notice to the insurance carrier that suit has been filed on your behalf, the carrier must provide you with notice of its intent to pursue its own claim independent of your action and pursue that claim independently of your action. If they fail to do so, then it may be possible to reduce the subrogation claim based upon the attorney fees and costs you incurred in the acquisition of the common fund by which the subrogation claim is liquidated therefrom either in whole or in part.

The second concept is referred to as the "made whole (or make whole) doctrine." The made whole (sometimes referred to as the make whole) doctrine has been adopted by a number of state. It provides that an insurance company’s claim for subrogation is subordinated to the policyholder’s ability to be made whole first from the proceeds of a verdict or settlement from another party before the insurance carrier has a right to be reimbursed for medical payments it has paid on your behalf regardless of the language set forth in the insurance policy pertaining to subrogation. However, the Idaho Appellate Courts have yet to address this issue. Nevertheless, a number of insurance companies will negotiate its claim for subrogation where it is obvious that their policyholder or insureds are unable to be made whole from the proceeds of a lawsuit or claim against a third party. This issue is something you will want to discuss with your attorney to formulate a strategy as to how to address subgation in your case in the event your insurance coverage pays for any of your medical expenses arising from a motor vehicle collision.

If you or a loved one have been injured as a result of a car accident, you should contact an experienced trial lawyer to arrange a free initial consultation. Boise Personal Injury and Auto Accident Trial Lawyer Alan Morton has over 31 years of experience in helping auto accident victims seek compensation for their injuries and damages arising from a car crash. You can reach Mr. Morton to schedule an initial free consultation by calling 208.344.5555 or toll free at 888.716.8021 or by completing an online contact form. Mr. Morton is available to meet with you in a confidential setting at his office or your home, workplace, hospital or any other convenient location to discuss with you the facts of your case and to help you better understand your legal rights and remedies.

Alan Morton
Advocate for Justice/Trial Lawyer