South Dakota Governor Mike Rounds has vetoed legislation that would have prohibited insurers from recovering funds from liable parties and would have unfairly and unnecessarily increased insurance costs for South Dakotans had it been enacted into law, according to the American Insurance Association.
Subrogation is used by insurers in most states to balance damage awards and claims. Insurers use the practice to recover funds from the party or parties responsible for an insured’s loss. If SB 169 had been enacted into law, insurers would have been prohibited from recovering funds from the liable parties even though the insurer may have already issued payment to the injured parties, AIA said.
“Subrogation is an accepted, fair and equitable tool used by insurers to keep costs down for policyholders. Steve Schneider, AIA’s Midwest regional vice president of state affairs.
Source: AIA
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