Which of the following statements about subrogation is true?

Which of the following statements about subrogation is true? 



A) Subrogation eliminates adverse selection.
B) Subrogation helps to hold down the cost of insurance.
C) Subrogation results in violation of the principle of indemnity.
D) Subrogation permits a party who caused a loss to avoid responsibility for the loss.


Answer: B) Subrogation helps to hold down the cost of insurance.

Popular posts from this blog

You are riding in Sarah's car when she fails to yield and causes an accident. Which of the following coverages would NOT pay for your injuries?

You are riding in Sarah's car when she fails to yield and causes an accident. Which of the following coverages would NOT pay for your injuries? Answer: Sarah's Collision coverage In the scenario described, if you are riding in Sarah's car when she fails to yield and causes an accident, the coverage that would typically not pay for your injuries would be "Medical Payments Coverage" (MedPay) or "Personal Injury Protection" (PIP), depending on the specific insurance policy and jurisdiction. Here's a breakdown of the relevant coverages and why they may or may not apply: Liability Coverage : This coverage pays for injuries and property damage you cause to others in an accident where you are at fault. Since Sarah is at fault in this scenario, her liability coverage would typically cover injuries to other parties involved in the accident, including you as a passenger in her car. However, it would not cover your injuries. Medical Payments Coverage (MedPay) :
Read more