In Connecticutt, there is a common law "make whole" doctrine, under which an insurer's right of subrogation may only be enforced after the insured has been fully compensated for his loss. In Fireman's Fund Ins. Co. v. TD Banknorth Ins. Agency Inc.
, an insured argued that the insurer could not collect from the escrowed funds containing the settlement of its claims against third-parties until it had recovered its deductible ($150,000) under the "make whole" doctrine. The District Court held that the subrogation clause in the insurance contract abrogated the "make whole" doctrine. On appeal, the Second Circuit disagreed. However, the Court noted that the Connecticut courts had not decided whether the "make whole" doctrine applied to deductibles. The Court certified this question to the Connecticutt Supreme Court.
The Second Circuit's decision in this case can be found here