The judicial meaning of Subrogation is substitution. It is the substitution of one person for another, so that the rights and duties as attached to the original person attach to the substituted person.
Under the doctrine, the insurer is substituted for the insured after fulfilling some contractual obligations.
Subrogation is a convenient way of describing a transfer of right from one person to another without the assent of the person from whom the rights are transferred and which take place by operation of law.
The right exist to prevent the imbalance in financial aquisition by one party to the detriment of the other. But the right only exist where there is a total loss and not even where there is a partial loss…
The rule of law that the insurance must not be used to turn what is essentially a loss or misfortune into a devise for making profits.
The insurer is therefore entitled to the advantages of every right of the assured whether such rights exist in contract, tort, or under statutes or any other rights whether by way of legal or equitable interest.
The doctrine does not rest on contract but on equity.
The doctrine of Subrogation arise in all policies which are contracts of indemnity. Contracts of indemnity include marine insurance policies and others like fire, motor, fidelity, burglary to mention a few.
The doctrine of Subrogation arises after the insurer has met its obligation with the insured . In other words , after the insurer has paid the loss insured by the insurer.
The doctrine thus places the insurer in the position of the insured and takes over all his rights and remedies against the person on respect of the subject matter of insurance .- Yerokun