Subrogation is the process by which an insurance company, after paying a loss to its insured, recovers the amount paid for damages (which can include the insured's deductible) from the legally liable party. For example, the not-at-fault company pays for their not-at-fault insured's auto damage under collision coverage. The not-at-fault company collects the money they paid their not-at-fault insured from the at-fault company.