Which concept signifies the insurer's ability to recover costs from third parties responsible for a loss?

The concept that signifies the insurer's ability to recover costs from third parties responsible for a loss is subrogation. Subrogation occurs when an insurance company pays a claim to the insured and then seeks to recover that amount from the party at fault for the loss. This process allows insurers to transfer the legal rights of the insured to pursue compensation from the responsible third party, effectively stepping into the shoes of the insured. Subrogation helps to mitigate the insurer's losses and is an important aspect of the insurance process, ensuring that the costs of claims can be recouped from those who caused the damage. Through subrogation, the overall cost of insurance can be reduced, benefiting all policyholders by keeping premiums more affordable.