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Mitigation of Damages Clause
Everyone is bound by this concept
The Mitigation of Damages Clause is both a clause in your auto policy and a legal concept that carries a lot of weight in a court of law.
This clause imposes an affirmative duty on you, the insured (consumer).
You have to actively do whatever you can to avoid your damages from getting any worse.
Courts uphold these clauses because they are on the best interest of the public by not allowing for waste.
Therefore, if you let your car sit somewhere, acquiring storage charges, then your insurance company (or the insurance company of the opposing party) will not cover the entire or a portion of the bill.
If you are having problems with an insurance company delaying a decision regarding coverage and/or liability (fault), then write and tell them that they need to move along because charges are accruing.
This will not necessarily change anything, but in case of dispute, you will have a paper trail to help protect your interest.
A good example of a mitigation of damages issue is a leaking window due to an accident. Do not wait until water ruins your vehicle’s interior to have it fixed.
The insurance carrier could deny coverage for all damages to the vehicle interior (they will still have to pay for the window).
It is important to note here that if you are dealing with someone else’s insurance company, they can take a long time to determine whether they provide coverage or not.
Just waiting for them will not fulfill the mitigation of damages requirement, so you should either involve your own insurance company, or decide to take matters into your own hands (pay out of pocket or move the car).
Let me put it this way, waiting for an insurance company to decide coverage or liability IS NOT mitigation of damages.
Be sure to be actively trying to move the claim and the repairs forward.
Please understand the difference between this clause and avoidable consequences clause.
They are similar concepts but an avoidable consequence situation occurs when an injured person declines medical treatment due to reasonable circumstances (for example, a very painful surgery or blood transfusions).
The reasonableness of something like this is a question for a jury to answer (is not a matter of law).
Avoidable consequences issues do not come up as often, but if you find yourself in this situation, do not let the insurance carrier decline or substantially reduce (they are entitled to reduce but not as much) your damages award as much as with a lack of mitigation of damages.
A lack of mitigation of damages must be found on the face of “not being reasonable.”
Click below for an explanation of insurance coverages and terms:
Automobile Liability Insurance or Liability Page 1
Automobile Liability Insurance or Liability Page 2
Automobile Medical Payments or Personal Injury Protection (PIP) Page 1
Automobile Medical Payments or Personal Injury Protection (PIP) Page 2
Collision Coverage (Protection Against Loss to the Auto) Page 1
Collision Coverage (Protection Against Loss to the Auto) Page 2
Comprehensive Coverage (Protection Against Loss to the Auto) Page 1
Comprehensive Coverage (Protection Against Loss to the Auto) Page 2
Under or Uninsured Motorist Property Damage (UMPD) Page 1
Under or Uninsured Motorist Property Damage (UMPD) Page 2
Under or Uninsured Motorist Bodily Injury (UMBI)
Rental Reimbursement or Loss of Use Coverage Page 1
Rental Reimbursement or Loss of Use Coverage Page 2
Insurance Clauses and Terms
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