Under what circumstances may an insurer's subrogation rights arise?

The correct answer is that an insurer's subrogation rights may arise under all of the mentioned circumstances: in contract, in the tort of negligence, and under statute.

Subrogation is a legal process that allows an insurer to pursue recovery from a third party after the insurer has paid a claim to the insured. This concept can be found in several legal contexts:

1. In contract: Most insurance policies explicitly include subrogation clauses. These clauses grant the insurer the right to step into the shoes of the insured after a loss has been compensated. This means that, as part of their contract with the insured, insurers have the right to recover the costs from a third party responsible for the insured's loss. This contractual provision is fundamental to the insurance industry as it helps to redistribute the costs of losses and ensures that the insurer does not absorb the entire financial burden.

2. In the tort of negligence: If a third party’s negligent actions lead to a loss for the insured, the insurer can seek subrogation rights to recover the costs from the negligent party. For example, if an insured driver is involved in a car accident caused by another driver, the insurer can pay for the damages and subsequently pursue the negligent driver to recover