Certified Insurance Service Representative (CISR) Commercial Casualty I Practice Exam

Waiving subrogation rights prevents the insurer from going after the insured to recover claim costs, so it keeps the insurer and the insured from clashing over who caused the loss. Subrogation lets the insurer step into the insured’s shoes to pursue the at-fault party after paying a claim. When that right is waived, the insurer won’t seek reimbursement from the insured, which preserves a cooperative relationship and avoids disputes about fault or responsibility between the two parties. This is why the insurer and the insured are the primary pair affected by a subrogation waiver in risk transfer.