When Opting for Reduced PIP Coverage, the Duty to Mitigate Damages Remains but the Fee Schedules Do Not Apply

The duty to mitigate damages is a longstanding one that goes back to the common law. Here, the Michigan Supreme Court merely extended that duty to those who bring their claim in tort rather than no-fault after opting out of PIP benefits due to qualified health insurance coverage. However, the Supreme Court declined to extend the fee schedule limitations of MCL § 500.3157 to third-party claims brought in tort.

This ruling is important because, as more and more individuals forego PIP benefits due to qualified insurance coverage to save on costs, more claims may wind up being brought in tort where the application of the no-fault statutes either apply differently or not at all, resulting in unforeseen liability exposure to insurers for damages.  As regarding PIP benefits, the Supreme Court was clear here that the no-fault statutes are intended to define the scope of PIP benefits, not claims for damages in tort under MCL § 500.3135(3)(c).