What does "subrogation" refer to in health insurance?

Subrogation in health insurance refers to the process whereby an insurance company seeks to recover costs from the insurance company of the party that was at fault in an incident causing a loss. This usually comes into play when a policyholder has incurred medical expenses due to an accident or injury that was someone else's fault.

In these situations, the health insurer initially pays for the policyholder's medical claims. However, once those payments are made, the insurer has the right to pursue reimbursement from the at-fault party’s insurance. This practice ensures that the cost burden does not unfairly fall on the insurer when another party is liable for the damages.

The other options do not accurately reflect the definition of subrogation. Renewing insurance policies, providing reimbursements, and assessing claims are all standard processes and activities within the insurance industry but do not encapsulate the essence of what subrogation entails.