---
title: "Check whether statute limits subrogation against a family member, permitted driver or employee"
url: "https://ailawframework.com/practice/insurance-law/check-whether-statute-limits-subrogation-against-a-family-member-permitt"
type: "task"
site: "AI Law Framework"
id: "A22-MA20261022-3"
practice_area: "Insurance Law"
tier: "yellow"
lawyer_review: "required"
last_reviewed: "2026-10-25"
---

# Check whether statute limits subrogation against a family member, permitted driver or employee

> From the policy and the loss report, list the third party, the relationship the papers show to the insured, whether the loss arose from use of a road motor vehicle the subject of the policy, whether the third party was…

Canonical page: https://ailawframework.com/practice/insurance-law/check-whether-statute-limits-subrogation-against-a-family-member-permitt  
Last reviewed: 2026-10-25

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Insurance Law](https://ailawframework.com/practice/insurance-law.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | From the policy and the loss report, list the third party, the relationship the papers show to the insured, whether the loss arose from use of a road motor vehicle the subject of the policy, whether the third party was the insured's employee, and whether the papers allege serious or wilful misconduct. Do not conclude that subrogation is barred. |
| What the lawyer must review | The lawyer applies sections 65 and 66. Section 65 applies where the insurer is liable for a loss under a contract of general insurance, would otherwise be subrogated to the insured's rights against the third party, and the insured has not exercised those rights and might reasonably be expected not to, because of a family or other personal relationship, or because the insured expressly or impliedly consented to the third party using a road motor vehicle that is the subject-matter of the contract. It does not apply where the third party's conduct occurred in the course of or arose out of employment by the insured, or was serious or wilful misconduct. Where the third party is uninsured for that liability, section 65(3) says the insurer does not have the right of subrogation. Where the third party is insured, recovery in subrogation cannot exceed what the third party can recover under that insurance. Section 65(5) and (6) limit conditions that would force the insured to assign the rights. Section 66 is the employee rule: where the rights are exercisable against an employee and the conduct occurred in the course of or arose out of the employment and was not serious or wilful misconduct, the insurer does not have the right to be subrogated against the employee. |
| Written for / versions | 1 jurisdiction versions below |

## Checking plan

**Source-by-source verification**

Trace relied-on content to independent sources and check for relevant material the output has missed.

- What the AI does: From the policy and the loss report, list the third party, the relationship the papers show to the insured, whether the loss arose from use of a road motor vehicle the subject of the policy, whether the third party was the insured's employee, and whether the papers allege serious or wilful misconduct. Do not conclude that subrogation is barred.
- What the lawyer does: The lawyer applies sections 65 and 66. Section 65 applies where the insurer is liable for a loss under a contract of general insurance, would otherwise be subrogated to the insured's rights against the third party, and the insured has not exercised those rights and might reasonably be expected not to, because of a family or other personal relationship, or because the insured expressly or impliedly consented to the third party using a road motor vehicle that is the subject-matter of the contract. It does not apply where the third party's conduct occurred in the course of or arose out of employment by the insured, or was serious or wilful misconduct. Where the third party is uninsured for that liability, section 65(3) says the insurer does not have the right of subrogation. Where the third party is insured, recovery in subrogation cannot exceed what the third party can recover under that insurance. Section 65(5) and (6) limit conditions that would force the insured to assign the rights. Section 66 is the employee rule: where the rights are exercisable against an employee and the conduct occurred in the course of or arose out of the employment and was not serious or wilful misconduct, the insurer does not have the right to be subrogated against the employee.
- Who reviews: Responsible lawyer with competence in the matter
- Basis: Practical workflow informed by the linked primary sources; the traffic light and working checks are editorial guidance, not a court classification.
- Why: The level reflects what the work is, the consequence of an error, and how much of the output the lawyer must independently re-derive.

## Checks the lawyer makes

1. Use section 65 for the family, personal-relationship and permitted-driver limbs. Do not use it for an employee. Section 65(2) takes employment out of section 65.
2. Use section 66 for the employee, and record whether serious or wilful misconduct is alleged. Both sections use that carve-out.
3. Record whether the third party has their own insurance. Section 65(3) and (4) treat the uninsured and the insured third party differently.
4. Do not ask the insured to assign the rights as a condition of payment where section 65(5) applies. An assignment obtained that way is void under section 65(6).

## Notes

- These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.

## Sources

- [Insurance Contracts Act 1984 (Cth) section 65](https://classic.austlii.edu.au/au/legis/cth/consol_act/ica1984220/s65.html) (checked 2026-10-22)
- [Insurance Contracts Act 1984 (Cth) section 66](https://classic.austlii.edu.au/au/legis/cth/consol_act/ica1984220/s66.html) (checked 2026-10-22)

## Jurisdiction versions

| Jurisdiction | Level |
| --- | --- |
| [Queensland](https://ailawframework.com/practice/insurance-law/check-whether-statute-limits-subrogation-against-a-family-member-permitt/queensland.md) | Yellow |

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*