Subrogation: Insured or Not Insured

Absent express covenants waiving subrogation and releasing insured claims, however, landlords and tenants can achieve the same end ' ie, protection from an insurer's subrogated claim ' by requiring that each name the other as an 'additional insured' on its respective policy. As the Pennsylvania Superior Court explained with eloquent economy: 'Subrogation is an equitable doctrine; and, therefore, equitable principles apply in determining whether subrogation is available. By definition subrogation can arise only against third persons to whom the insurer owes no duty. It follows and, indeed, is now well established that an insurer cannot recover by means of subrogation against its own insured.' Remy v. Michael D's Carpet Outlets, 571 A.2d 446, 452 (Pa. Super. 1990) (citations omitted) , aff'd on other grounds, 637 A.2d 603 (1993). Indeed, this 'antisubrogation' rule has even been stretched so far as to estop subrogation when the 'insured' is insured by the insurance carrier under a different insurance policy. Fidelity and Guaranty Insurance Underwriters, Inc. v Joseph Banks Construction Co. Inc., 14 F. Supp. 2d 704 (M.D. Pa. 1998). Like the express waiver of subrogation clauses, this approach to protecting against an insurance carrier's subrogation of claims requires conscious decisions by the parties ' insisting on being named as an 'additional insured' on the other party's policy or having the prescience to procure insurance from the same insurer as the other party.

What happens, however, when parties fail to waive subrogation rights, release each other from insured claims, or name the other as an additional insured? Are insurance carriers then unfettered in subrogating to a claim and seeking compensation from a negligent party?