What term describes the reimbursement of benefits for injuries caused by a third party?

The term that describes the reimbursement of benefits for injuries caused by a third party is subrogation. This process occurs when an insurance company pays out benefits to an insured for damages or injuries and then seeks to recover those costs from the party that was actually responsible for the injury.

In cases involving subrogation, the insurance company essentially steps into the shoes of the insured to pursue recovery from the third party who caused the loss. This is an important aspect of insurance because it helps insurers limit their losses and can help keep premium costs down for all policyholders.

Understanding subrogation is crucial in the context of accident and health insurance, as it illustrates how insurers manage claims and recoveries related to third-party liability. The requirement for an insurer to pursue a third party is typically outlined in the policy terms, and it benefits all parties involved by ensuring that those who are truly at fault are held responsible for their actions.