What Happens if I Ignore an Insurance Subrogation Letter for Homeowner Property Damage?

Subrogation letters may result in lawsuits if ignored.

Jack Hollingsworth/Photodisc/Getty Images

Insurance companies sometimes have to pay their customers for damages caused by other people. The insurance company will then try to subrogate, or recover the amount of money it paid on the claim, against the person causing the damage. Subrogation letters should be carefully reviewed because the recipient's legal rights could be affected in the subrogation process.

Initial Communications

An insurer has different ways to seek reimbursement from the responsible party. Sometimes a simple phone call to the negligent person's insurer can resolve the matter. However, if the responsible person is uninsured, the subrogation carrier must deal directly with her. If the negligent person is difficult to locate, the insurer may obtain a background summary called a skip trace.

Subrogation Letters

Subrogation adjusters send letters to those who appear to be responsible for reimbursing the insurance company. Letters generally include the date of the claim, the amount paid by the insurer, a summary of the damages and a request for the recipient to contact the insurance company. Although the letter itself does not affect the recipient's legal rights, it does represent a chance to attempt settlement of the dispute without litigation. If the recipient ignores the letter, the insurer may continue to mail requests for reimbursement or may choose to file a lawsuit against the responsible party.


Some law firms specialize in filing subrogation lawsuits for insurance companies. They file a high volume of lawsuits knowing that many of the defendants will be uninsured and not represented by counsel. Many of these lawsuits result in the plaintiff obtaining a default judgment. A defendant can avoid a default judgment by filing a written response called an answer with the court. However, without an attorney, the defendant will be at a disadvantage and may not know how to follow court procedures. Defendants seeking to fight a subrogation claim typically decide to hire counsel.

Possible Defenses

If a defendant believes she is not responsible for the damage, she can use evidence like photographs and witnesses to dispute the case in court. Also, if the insurer waited too long to file the lawsuit, the defendant may argue that the statute of limitations has expired. If the suit was timely filed and the defendant admits to owing the damages, she may agree to make monthly payments in exchange for the lawsuit being dismissed.