Subrogation

Subrogation is a core principle in insurance law, particularly common in foreign trade transport insurance. It means that after the insurer (insurance company) compensates the insured (foreign trade enterprise) for losses within the coverage, the insurer acquires the insured's right to claim against third-party liable parties (such as carriers, ports, warehouses, etc.) and has the right to recover from such third parties in its own name. Usage scenarios: Goods are damaged during sea, air, or land transport due to third-party negligence (e.g., improper stowage by the carrier, unseaworthiness of the vessel), and the insurance company seeks recovery from the liable party after compensation. Precautions: The insured must sign a letter of subrogation when claiming and assist the insurance company in providing necessary documents; if the insured has already received compensation from a third party, it cannot claim again; the right of subrogation is limited to the amount compensated by the insurance company and must not prejudice the insured's remaining right to claim. Difference from other terms: Subrogation differs from 'Abandonment,' which involves the transfer of ownership when the subject matter is deemed a constructive total loss; it also differs from 'Recovery,' which is the insurer's own pursuit of recovery, whereas subrogation emphasizes the statutory transfer of rights. Foreign trade practitioners should understand this term to cooperate with the insurance company's recovery efforts and avoid affecting the effectiveness of recovery due to their own negligence.