Waiver of Subrogation
A waiver of subrogation is a provision, usually added by endorsement and often required by contract, in which the insurer gives up its right to recover a covered loss payment from a specified party who may have caused the loss.
Last updated October 13, 2026
How a waiver of subrogation works
Subrogation lets an insurer that has paid a claim step into the insured's shoes and pursue the party responsible for the loss. The standard CGL policy addresses this in its transfer of rights of recovery condition. IRMI notes that an insured can generally release a third party before a loss without breaching that condition, and that an insurer's rights are no greater than the insured's.
A waiver of subrogation endorsement has the insurer formally give up those rights against named parties. The ISO general liability form is CG 24 04, titled Waiver of Transfer of Rights of Recovery Against Others to Us. It generally applies where the insured has agreed in a written contract, made before the loss, to waive recovery against the named party, and the waiver is usually limited to the extent the insured agreed to it. The waiver affects only the insurer's recovery rights, and it does not release the third party from legal liability in other respects.
Waivers can be added to general liability, workers' compensation, property, and auto policies, and wording differs by form and state. Contracts may require it in favor of the other party, such as a landlord or general contractor.
Waiver of subrogation vs. related terms
- Waiver vs. subrogation. Subrogation is the insurer's right to recover from the responsible party after paying a claim. The waiver is the insurer agreeing, ahead of a loss, not to use that right against a named party.
- Waiver vs. additional insured status. A waiver only affects recovery rights. Additional insured status gives the other party protection under your policy. A contract may require both.
- Waiver vs. indemnity or hold harmless clauses. An indemnity clause is a promise between the contracting parties to cover certain losses. A waiver is an insurance endorsement that limits the insurer's recovery rights. They do different jobs and can appear together.
- Waiver vs. primary and non-contributory wording. Primary and non-contributory wording governs the order in which policies respond. It does not waive recovery rights.
- Waiver vs. certificate of insurance. A certificate of insurance reports what is in place. It does not create a waiver unless the policy itself includes the endorsement.
Example
A company leases office space, and the lease requires it to waive subrogation against the landlord on its property policy. Later, a fire is caused by the landlord's contractor and the company's insurer pays the claim. Because the waiver is in place, the insurer generally cannot then sue the landlord to recover what it paid.
A second example
A hypothetical hardware company provides contract staff who work on a customer's site. The services agreement requires a waiver of subrogation on the company's workers' compensation policy in favor of the customer. Later, a contractor is injured partly due to the customer's negligence. The workers' compensation insurer pays benefits as required, and because of the waiver it generally cannot then pursue the customer for what it paid. The insurer may charge an additional premium for adding the waiver.
What to watch for
- Get the timing right. The contract and the endorsement need to exist before the loss. A waiver added afterward may not be effective.
- Scheduled versus blanket. A waiver may name specific parties or apply automatically where a written contract requires it.
- Not additional insured status. A waiver is different from additional insured status and gives no coverage on its own.
- Cost and availability. Insurers may charge for waivers, and some forms limit them. Ask early.
- Cross-policy consistency. The waiver must appear on every policy the contract mentions, and the certificate of insurance should reflect it accurately.
Questions to ask your broker or insurer
- Which policies does the contract require the waiver on: general liability, workers' compensation, property, auto?
- Is the waiver scheduled to named parties or blanket where a written contract requires it?
- Is there an additional premium, and is it available in every state where we operate?
- Will the endorsement be attached before the contract takes effect, and renewed each year?
- Does the certificate describe the waiver accurately?
Common mistakes
- Signing a contract with a waiver clause before checking the policy allows it.
- Assuming the certificate alone creates the waiver.
- Agreeing to a one-way waiver when a mutual one was negotiable.
- Forgetting to carry the endorsement over at renewal.
Why it matters for technology, AI, fintech and digital-asset companies
Office leases, data center colocation agreements, and enterprise customer contracts often include waiver of subrogation clauses. Signing without checking whether the policy can accommodate the waiver can lead to a breach of contract or a rejected certificate. See enterprise contract insurance requirements.
Fast-growing companies sign office leases, colocation and cloud infrastructure agreements, enterprise customer contracts and vendor agreements in quick succession, and many contain waiver language. Venture-backed teams often discover the requirement only when a customer's procurement team reviews the certificate. Fintech and digital-asset companies that work with banks, custodians or partners may meet similar clauses. See our pages on general liability, property insurance and data centers, and the glossary entry on endorsements.
See how this applies in practice: insurance requirements in enterprise contracts.
Related terms
Frequently asked questions
What is a waiver of subrogation?
A waiver of subrogation is a provision, usually added by endorsement and often required by contract, in which the insurer gives up its right to recover a covered loss payment from a specified party who may have caused the loss.
Why do contracts require a waiver of subrogation?
It keeps the parties' insurers from suing each other after a loss. Landlords, general contractors, and customers often require it so that they are not pursued for losses the other party's insurance has already paid.
What is the difference between a waiver of subrogation and additional insured status?
A waiver of subrogation only stops your insurer from recovering from a named party. Additional insured status gives that party coverage under your policy. A contract may require both, and each needs its own policy endorsement or wording.
Does a waiver of subrogation cost extra?
It can. Some insurers add it at no charge, while others charge an additional premium or limit it to written contracts. Blanket and scheduled waivers may be priced differently, so ask early.
Is a waiver of subrogation the same as an indemnity or hold harmless agreement?
No. An indemnity or hold harmless clause is a contractual promise between the parties. A waiver of subrogation is an endorsement that limits what the insurer can recover after paying a claim. Contracts often include both.
Can I add a waiver of subrogation after a loss?
Generally no. The waiver usually has to be in place under a written contract before the loss to be effective, so adding it afterward may not work.
What does waiver of subrogation in favor of mean?
It names the party the insurer agrees not to pursue after paying a claim, such as a landlord or general contractor. The endorsement or contract usually identifies that party.
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