Which term describes the insurance company's right to seek recovery from responsible third parties?

The term that describes the insurance company's right to seek recovery from responsible third parties is "subrogation." When an insured individual suffers a loss due to the actions of another party, the insurer pays the claim to the insured and then assumes the right to pursue recovery from the third party that caused the loss. This process allows the insurer to mitigate its own losses by recovering the amount it paid in claims.

Subrogation serves multiple purposes: it helps to keep insurance premiums lower by allowing insurers to recoup some of their expenses, and it holds the responsible party accountable for their actions. This right is crucial for the financial stability of insurance companies, making subrogation a fundamental concept in property and casualty insurance.

Other terms listed, such as concealment, salvage, and fraud, do not pertain to the recovery rights of an insurer from third parties. Concealment refers to the hiding of material information by the insured during the underwriting process, salvage relates to the insurer's right to recover and sell damaged property after a loss, and fraud involves wrongful or deceptive acts aimed at causing a loss or gain. Therefore, subrogation is accurately identified as the correct term for the insurer's recovery rights.