Escrow & Title
What is 'subrogation' in title insurance and how does it affect Hawaii property transactions?
AA. The title company's right to take over the insured's legal claims against third parties after paying a title insurance claim✓ Correct
BB. A right allowing junior lienholders to move ahead of senior ones
CC. The transfer of title insurance from one property to another
DD. A process allowing buyers to inherit the seller's title insurance policy
Explanation
Subrogation is the title insurer's right to 'step into the shoes' of the insured and pursue legal claims against third parties responsible for the title loss, after paying the insured's claim. For example, if a forger created a defective deed and the insurer paid the insured's loss, the insurer may pursue the forger for reimbursement.
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