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Conventional Subrogation

Conventional Subrogation


Conventional Subrogation — subrogation rights that have been modified between two parties by the terms of a contract entered into by them. Conventional subrogation is necessarily narrower in scope than subrogation under common law (or equitable subrogation) because a contract cannot expand subrogation rights, only restrict them. An example of conventional subrogation is the agreement of contracting parties to waive their rights of recovery against each other to the extent to which insurance is being maintained on the exposures for which the parties might otherwise incur liability.

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