In the UPS driver example, the injury arose out of and in the course of employment. This is an example of which concept?

• A. Indemnification
• B. Collision Liability
• C. Subrogation
• D. Assumption Of Risk

Answer: (C)

Subrogation means the insurer, after paying a claim, has the right to recover those payments from the party responsible for the loss. In a work-related injury, the worker’s compensation insurer provides benefits because the injury arose out of and in the course of employment. If someone else caused the injury, the insurer can step into the employee’s shoes and sue the at-fault party to get back the benefits paid. The UPS driver scenario shows this: benefits are paid for a job-related injury, and the insurer then pursues the third party who caused the harm to recover those costs. This isn’t about reimbursing the insured for losses (indemnification), auto liability coverage (collision liability), or voluntarily accepting risk (assumption of risk).