Research On The Restriction Of Insurance Subrogation

The system of insurance subrogation is an exquisitely system governed by the principle of indemnity, which not only can prevent the insured from profiting by insurance, but also can strengthen the insurance fund and increase the responsibility of the third party. It has been developed and perfected through rich and varied judicial practices, rare statute legislation and persistent research work by judges and scholars. The history of the insurance industry of our country is too short for us to understand the marrow of subrogation system, therefore, we come across a lot of puzzles and problems in the practice of legislation and justice. The system of insurance subrogation has not been given sufficient attention either in theory or in practice in our country. Some restriction during exercising the right of subrogation is rational and feasible, but other restriction is irrational which can be avoided. According to the general introduction to the system of insurance subrogation, includes legal characteristics, theoretical foundation and legal value, this paper firstly analyzes the rationality of the system of insurance subrogation. Secondly, provides specific analysis to the restriction of exercising the right of subrogation, includes scope of application, the time bar to the third party, the problem on the name for exercising it,the condition of exercising it, the confinement of the exercising object, the abandonment of this right. The legal restriction and the restriction of ego confine the exercising the right of subrogation, With the development of the insurance industry,the insurance company may gradually emphasize the exercising of the right of insurance subrogation. This paper will discus whether those cause of restriction is rational and give opinions about irrational regulation in law. In that case, the legal system of insurance subrogation will be perfect, the system of insurance subrogation can develop wonderfully and give play to the superiority of insurance industry. The whole paper contains five parts apart from the introductory part.The first part provides a general introduction to the system of insurance subrogation, includes intensive properties, legal characteristics, analyzes its theoretical foundation and legal value, and tries to give a general portrayal of the system. The principle of subrogation which finds its origin in the system of assignment in Roman law, has taken shape after the pregnancy, development and perfection of modern insurance industry. Scholars have different viewpoint on characteristics of insurance subrogation. Civil law scholars take subrogation as legal assignment, whereas common law scholars regard it as a right with both equitable and common law characteristics, anyhow, most countries of both legal systems unanimously receive the principle in their statutes. In our country, we adopt an idea of civil law scholars which take subrogation as legal assignment. The principle as the ancillary of indemnity principle which also complies with the principle of fairness, can prevent the insured from profiting, prohibit the third party escape liability, and provide the insured with possibility of lower the premium rate.The second part analyses the scope of application of insurance subrogation. This part firstly introduces different viewpoint and legislation of subrogation application in the personal insurance, especially focus on whether insurance subrogation applicable to compensatory insurance contract, such as accidental injury insurance and health insurance. Most of our scholars considers that this right is appropriate for property insurance but not for personal insurance. And It is prescribed in the 46th item of our Insurance Law that right of insurance subrogation is limited to property insurance. Analyzing the disparity on life insurance, health insurance and accidental injury insurance, we can get a conclusion that the right of insurance subrogation is not appropriate for life insurance. However, payment in health insurance, medical and in-hospital expenses in accidental injury insurance are all belonging to indemnity, and it can be evidenced by the objective expenses. Therefore, it can be considered to be applied to the right of subrogation. In a word, we should modify our legislation on the scope of application of insurance subrogation and distinguish different types of personal insurance contract.The third part introduces the restriction of time bar. Analyzing the characteristic of insurance subrogation, this part mainly investigates problems which the insurer may encounter during insurance subrogation time bar, and propose solutions to protect the right of time bar and make the right of insurance subrogation exercise successfully. First, the time bar of insurance subrogation is different from the time bar of insurance claim. The time bar of insurance subrogation is not explicitly regulated in our country. The right of compensation claim of insured to the third party is a kind of creditor claims, so the right of insurance subrogation is secondary to the right of compensation claim. That is, the time bar of compensation claim of insured is same as insurance subrogation of insurer. Second, there are two comments on how to confirm the beginning of time bar of insurance subrogation: one view considered that the time bar starts since the insurer subrogated to the right of insurance subrogation, the other view thinks that the time bar starts from the insured knows or should know the subject of insurance infringed by a third party. According to the analysis of characteristic of insurance subrogation and principle of fairness, the author considers that the second view should be adopted. At last, in the insurance business, some problems appeared in calculating the time bar of insurance subrogation. To solve those problems, insurer should raise awareness of time bar and given the insured reasonable obligation properly to protect time bar.The fourth part introduces legal restrictions and self-limiting in exercising insurance subrogation. First, the author introduces the name of exercising insurance subrogation. Different scholars have different ideas about the problem. Some scholars considered that insurance subrogation should be exercised in the name of insurer; some scholars considered that insurance subrogation should be exercised in the name of insured, and other scholars considered that insurance subrogation can be exercised in the name of both insurer and insured. Exploring the charcteristic of subrogation, jurisprudence and judicial practice, the author agrees on the point that insurance subrogation should be exercised in the name of insurer. Second, the author summarizes the exercising conditions of insurance subrogation. The three conditions includes that the insured possesses the right against the third party for indemnity, the scope of insurance subrogation is limited to insurance claims and that the insurer has indemnified the insured. Third, the author analyses the target of exercising insurance subrogation. The insurer is prohibited from exercising insurance subrogation against the insured and the people who have some special relationship with him, for example, the insured's family and employees. The author not only gives specific instructions of the composition of the family members, but also points out that insurance subrogation can be exercise to government. Fourth, when the insurance policy does not cover all the insured subject-matter, and the third party cannot satisfy the insured and the subrogated insurer, conflict happens. Who should be indemnified firstly? According to the analysis of charcteristic and function of insurance, the author considers that insured should take the priority. Fifth, the act of abstention of insurer may prevent the insurance subrogation exercise.The fifth part introduces and analyzes the challenge and reform faced by the system of subrogation. Nowadays, the rationality of insurance subrogation encountered unprecedented challenge and query; some counties began to limit the scope of subrogation in varied degree. After careful analysis, we can find that the viewpoint has a lot of defects on theory and some obstacles difficult to clear away. We should set up a complete system of insurance subrogation in both substantive law and procedural law.