Daniel Leon Fraire et al. v. Titan Insurance Company et al.

The issue on appeal is whether Titan Insurance Company, which issued a “no-fault” automobile insurance policy to a Michigan resident, is entitled to be reimbursed for “personal protection insurance benefits” paid to its insureds for injuries sustained in a vehicular accident in  Tennessee. After the insureds entered into a substantial settlement agreement with the tortfeasors in this civil action, which compensated them in addition to the benefits paid by Titan under the no-fault policy, Titan intervened seeking reimbursement of the benefits it paid. Titan contended that it was entitled, pursuant to Michigan’s No-Fault Insurance Act to reimbursement of the benefits remitted. The insureds, relying on the “made whole doctrine,” contended they had not been made whole by the settlement with the tortfeasor; therefore, Titan was not entitled to reimbursement. The trial court held that the made whole doctrine applied and that the insureds had not been made whole by the settlement; therefore, Titan was not entitled to reimbursement in any amount. Under Michigan’s No-Fault Insurance Act, specifically Mich. Comp. Laws § 500.3116(2), (4), the right of the no-fault insurer to reimbursement of “economic” benefits paid for the benefit of its insureds is not dependent upon whether its insureds have been made whole by a settlement with the tortfeasor. Therefore, Titan’s right to reimbursement of economic benefits paid is not dependent on whether its insureds were “made whole.” Accordingly, the judgment of the trial court is reversed, and we remand with instructions for the trial court to determine the extent to which Titan is entitled to be reimbursed.