Mitigation of Damages Clauses (also a legal concept) protects the insurance company!

It ensures that you avoid a bigger loss or damages by making you act reasonably.

Mitigation of Damages Clause is both a clause and a legal concept that carries a lot of weight in a court of law.

This clause imposes an affirmative duty on you. You have to actively do whatever you can to avoid damages getting any worst. Courts uphold these clauses because it is on the interest of the public to not allow 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 portion of the bill.

If you are having problems with an insurance company making a decision regarding coverage and/or liability (fault), then write to them 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 protect your interest.

A good example of a mitigation of damages issue is a leaking window due to an accident, do not sit down and wait until water ruins your interior. The insurance carrier could deny coverage to the interior (they will still have to pay for the window).

Evidence of Rust is Evidence that there was no mitigation of damages!

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. Waiting for them the entire time 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). Let me put 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. 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 (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 insurance carrier decline or substantially reduce (they are entitled to reduce but not as much) your damages award as a lack of mitigation of damages.

That is an �avoidable consequence� and therefore should not be seen or treated as a mitigation of damages issue. Note that if a jury finds that not undergoing surgery is reasonable, then the carrier cannot reduce the award at all (but at this point, you will be in a court of law, of course).

Mitigation of Damages is a powerful clause that will be used against you. Subrogation of Damages clauses is equally or even more powerful, but this time you can use it in your favor. Learn more.

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