Generally, in personal injury cases under the California Law, the individual who personally suffered the injury is the real party in interest entitled to maintain suit. As an exception, A person or entity obligated to pay for a loss caused by another may, by virtue of the payment, become subrogated to whatever claim the payee has against the person causing the loss. For example, in the personal injury context, an insurance company which pays its insured for injuries caused by a third person is subrogated to the insured’s claim against that third person [ State Farm Gen. Ins. Co. v. ells Fargo Bank, N.A. (2006)]. Such payment, in effect, operates as an assignment by operation of law of the injured party’s claim, and the insurance-company subrogee/assignee is thereafter the real party in interest on the claim [Automobile Ins. Co. of Hartford, Conn. v. Union Oil Co. (1948)].

Emotional distress damages are recoverable in a “bad faith” action brought by an insured against his or her insurer but only when the insured establishes actual financial loss resulting from the insurer’s breach of the covenant of good faith and fair dealing. Simple delay in payment, absent other egregious circumstances, does not constitute sufficient injury to support emotional distress damages[Waters v. United Services Auto. Ass’n (1996)]. Moreover, when an insurance carrier becomes subrogated to the claim of an insured against a third party tortfeasor, the payment of insurance proceeds is no longer a ‘collateral source.’ Where both the subrogee [insurer] and subrogor [insured] have a right of action against the tortfeasor  the tortfeasor would have potential double liability if payment of insurance benefits by the subrogee to the subrogor is allowed to be designated a ‘collateral source’ [ Ferraro v. Southern Calif. Gas. Co,]. It would be best to seek personal assistance from a lawyer in order to help you with your personal injury case.

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