Subrogation is:
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A. B. C. D.B
Subrogation is a legal principle that allows an insurance company, or another party, to step into the shoes of an insured person or business to recover money paid out as a result of a loss. The goal of subrogation is to shift the cost of a loss from the party who is not responsible for the loss to the party who is responsible for it.
Option B is the correct answer. Subrogation is the legal right of the insurer to recover from a third party who may be wholly or partly responsible for the loss paid under the terms of the policy. In other words, if an insurance company pays out a claim to its policyholder, and the loss was caused by someone else's negligence, the insurance company may be able to recover some or all of the money paid out from the responsible third party.
For example, if a car accident is caused by another driver who is at fault, and the insurance company pays out a claim to its policyholder for the damage caused, the insurance company may have the legal right to recover the money paid out from the at-fault driver or their insurance company.
Subrogation is an important principle in insurance, as it allows insurance companies to keep premiums low and prevent fraudulent claims by shifting the cost of a loss to the responsible party. It also helps ensure that individuals and businesses are held accountable for their actions, as they may be required to pay for the losses they cause.
Options A, C, and D are incorrect because they do not accurately describe subrogation. Option A describes a right to recover from vendors, which is not related to insurance or subrogation. Option C describes a right to recover from an organization, which is too general and does not specify who the organization is or what type of loss is being discussed. Option D describes a right of business to recover from a third party, but it does not specify that this is related to insurance or subrogation.