Diminished Value Claims

When a car has been in an accident, even after repairs are made, it will still have a lower resale value than one that never had an accident. Individuals who find themselves in this situation may want to consider filing a diminished value claim against the at-fault party’s insurance company. However, before an individual makes this decision, it is important that they understand the laws of their state regarding this type of claim. In addition, they should also take the time to get documentation that is specific to diminished value claims, such as an appraisal from a licensed independent appraiser.

When Can I File a Diminished Value Claim?

In most states, individuals can make a diminished value claim against the at-fault driver’s insurance company if they were not at fault in the accident. They can also typically file this type of claim against the insurance company that covers their own vehicle if they have uninsured/underinsured motorist coverage, though it is crucial to note that they cannot file this type of claim under their collision or comprehensive policy.

While some people may turn to car dealers or licensed auto appraisers for diminished value documentation, it is important to remember that this type of information should be used as supplemental evidence for your claim. A much better option is to work with a company that specializes in diminished value appraisals. They will provide you with a professional diminished value appraisal report that is unique to your vehicle’s specific circumstances and can be used as the foundation for your claim.

The majority of insurance companies utilize a formula called 17c to calculate the amount of diminished value an individual is entitled to receive for their vehicle. While this isn’t a guaranteed method for everyone, it is one of the most common ways to calculate diminished value. This formula will typically cap the total amount of diminished value at 10% of the vehicle’s pre-accident value, depending on the state. The insurance company will then apply a damage multiplier and mileage multiplier to this number to determine an appropriate claim amount.

When an individual is able to present a well-documented and researched diminished value claim, the insurance company will usually agree to a settlement within a reasonable amount of time. However, it is important for individuals to be prepared to take the at-fault party’s insurance provider to small claims court if they are not willing to acknowledge or pay for an individual’s diminished value claim.

Ultimately, diminished value is an area of auto insurance that many individuals are not aware of. This is partly due to the fact that the vast majority of insurance companies are not eager to pay out diminished value claims, and they often try to discourage individuals from making a claim by making it difficult or delaying the process. With the help of an attorney who specializes in this type of claim, though, individuals can make a successful diminished value claim.