When a surety pays a claim that it is obligated to pay, the surety is exonerated, and automatically acquires the claim and the rights of the creditor.

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When a surety pays a claim, the surety is not exonerated but instead steps into the shoes of the creditor through a process called subrogation, acquiring the rights and claims of the creditor against the debtor.

When a Surety Pays a Claim That It Is Obligated