The insurance company pays for the damages, but demands that the driver pays back the compensation.

Recourse in the insurance context refers to the insurance company demanding that all or part of the amount paid out to the injured party is reimbursed by the person responsible for the damages.

The insurance company may invoke their right of recourse if the driver:

caused the damage or injury on purpose, or through gross negligence

was under the influence of alcohol (or other intoxicants) was under the influence of alcohol (or other intoxicants)

had stolen the car had stolen the car

did not hold a valid driving licence did not hold a valid driving licence

was practice driving illegally was practice driving illegally