Reduce client losses and improve their loss histories with our Subrogation Unit

Any damage to one of your clients’ commercial properties will result in a highly stressful situation for the affected employees. But when a third party caused the loss, that’s doubly true.

When a third party is at fault, your clients can reclaim their excesses and wipe the claim from their loss histories through a process called subrogation. However, clients aren’t always aware that they can do this. Others sometimes don’t because they are worried about harming relationships with customers or key suppliers.

As a broker, this presents an opportunity for you to deepen relationships with your clients through advocating for their rights, reducing the financial impact of their claims, and helping to simplify a stressful situation. To support you in achieving these goals, FM has created a dedicated subrogation unit.

Introducing the FM subrogation unit

FM has always had a litigation team to support our loss adjustors. Our expert litigators return millions of dollars recovered from third parties back to FM clients each year. As we pursue justice for our clients, we also take care to be mindful of client relationships with any customers or suppliers who may be involved in a claim, ensuring that we are fair and even-handed.

In [2023], we decided to create a dedicated subrogation unit to handle claims smaller than $1 million. For our initial pilot scheme, this team focused exclusively on claims in North America. Their mission: To investigate claims where a third party may be at fault and ensure maximum recovery for our clients.

This team has proved highly successful, negotiating with third parties’ insurance carriers and even escalating cases to arbitration forums where applicable to repatriate funds to cover the cost of losses that weren’t our clients’ fault. In many cases, they have been able to claim back 100% of the cost of loss.

This pilot recovered almost $12 million in 2024 and returned $3 million to our clients. This helped to reduce their overall losses and minimize their loss histories. The project has been such a success, we are now looking to expand the subrogation function to cover new regions and territories.

How to deepen client relationships with subrogation

Wherever your clients are in the world, FM can help to minimize their liabilities and costs in the event of a loss. Here’s what you can do to support them through this process and help them get the justice they deserve:

1. Kickstart the process. Report the loss via the FM Portal and flag that a third party was involved so that we can start the investigation.
2. Ensure clients preserve the evidence. Engage the FM team ASAP to schedule a site visit and document what happened while remediation efforts get underway.
3. Inform the third party. Ensuring that the responsible party is notified of our investigation promptly is essential for protecting our legal ability to recover the loss from them.

Following these steps will ensure that we can support your clients in the right way—helping them to recover their deductibles and keep their loss sheets clean.

If you have an FM client you think could benefit from our subrogation expertise and support, we’d love to hear from you. Submit a new business enquiry here and we’ll be in touch ASAP.

This is part of a series of articles FM is producing to help brokers understand the value we can provide to their commercial property insurance clients. Look out for the next post in this series for more valuable insights.