So much of insurance revolves around who is at fault and who has to pay to make things right again. Waiver of subrogation is one more wrinkle in that complex equation.

Subrogation occurs when an insurer pays their insured for a loss caused by a third- party, and then attempts to recoup their payout by making a claim against the responsible third party.

For instance, if you’re in a car accident and it was the other party’s fault, your insurer pays for repairs to your vehicle and then pursues the other person’s insurance company for the loss. In your insurance policy, which is a contract between you and your insurance carrier, you agreed to allow the carrier to subrogate for any paid loss.

In a typical business contract, one business may ask another business to waive its rights of subrogation because the first business doesn’t want to be held responsible for a loss. When agreed to in such a contract, it prevents the business, and its insurer, who has agreed to waive their right, from seeking a share of the damages paid from the other party, even if they are at fault.

But be aware that when a business gives up its right to recover any losses, it increases the insurer’s risk and transfers responsibility to the insured and its insurer for sometimes uncontrollable losses. This can lead to unnecessary loss history and potentially increased insurance costs.

Conducting regular contractual reviews with your insurer agent can easily point out these exposures and help to you to understand and sometimes negotiate this requirement out of your risk profile.

Contact the professionals at Evergreen Insurance for more information.

Copyright 2022 Evergreen Insurance

Evergreen Insurance provides these updates for information only, and does not provide legal advice. To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.

Larger construction projects involve lots of separate parties coming together. When it comes to insuring the risks, it is common for each party to have their own liability policies. An alternative is a wrap-up insurance policy that protects everyone under one policy. Click on the image to download or print the information sheet.

As instances and the scope of ransomware events, and losses associated with them, continue to increase, some insurers are tightening their standards in providing cybersecurity coverage.

According to industry experts, insurers are restricting capacity and implementing increases in premiums to accommodate for businesses not keeping pace with the threat of malware and other online attacks.

Ransomware events began to climb in 2019, leading to the continuing response by insurers. On average, insurance rates have doubled since the surge in attacks began, with rising reinsurance costs expected to drive those rates higher.

Insurers certainly are not abandoning cyber liability coverage, but recognize the underlying issue is that while coverage may be adequate today, the rapidly evolving risk means it may not be adequate tomorrow.

Business owners can help their own cause by implementing as many precautions against online attacks as they can, which can contribute to keeping their insurance costs manageable under the circumstances.

The digital universe has opened a world of opportunity for businesses to grow, expand, and succeed. But the flip side of all that openness poses a threat that continues to grow, expand, and succeed as well.

Managing that risk will be a challenge for business owners and their insurers for the foreseeable future. Eternal vigilance may be the price of liberty, but it’s also the price of keeping your data protected online.

Contact the professionals at Evergreen Insurance for more information.

Copyright 2022 Evergreen Insurance

Evergreen Insurance provides these updates for information only, and does not provide legal advice. To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.

Grilling is a fun and delicious way to spend a summer night! When grilling around family and friends, it is important to keep safety in mind. Click on the image to download or print the safety sheet.