Reflection on 34 years of Subrogation

By: Joe Palumbo

Back in 1979, when I was a 1st year adjuster, subrogation was considered an “oh yeah, I’ll get to it” situation.   Claim handling back then was a one person experience, from intake of new claims to resolving salvage and subrogation.  Carrier to carrier recoveries and arbitration was usually left to Friday afternoons, if there was time.  

Uninsured Motorist pursuit was minimal at best.   There was the occasional dictate from home office to raise the level of recoveries efforts.   A couple of adjusters would team up and go knock on doors trying to find the money.   That was a very discomforting experience that was maybe done once a quarter.

In 1983, I had the opportunity to hire my 1st subrogation professional.  Her background was collections, something that was pretty foreign to the claims office.  The level of recoveries was very low, so when she asked for a reasonable hourly wage and 10% of whatever she collected, I agreed.  To my amazement, she collected $1M in her first year.   She was paid her commission for the first year and her compensation package was retooled.   She became the supervisor of the first subro department in the company and had three clerical people reporting to her.

30 years have gone by since that first subro unit.   I now see subro organizations that are as large as the entire claims organization of carriers from way back when.  Subrogation has increased its status from a group of clerical workers to CSRP recognized subrogation professionals.

Congratulations to all of the Subrogation Professionals in the industry.   We bring in the money that retains customers by returning deductibles and improves the bottom line of the carriers.