Most people know how collision and liability property damage claims work following a car accident. However, from my experience as a Car Accident Lawyer, most people are confused when it comes to diminished value claims. Over the years, I’ve been asked so many questions about diminished value, I thought it would be helpful to put together this brief guide.
1. What is diminished value?
Simply put, it is the value a vehicle loses as a result of being in a collision. No matter how good the repairs, a wrecked car is never going to be worth as much as a similar car that has never been in an accident. Think about it this way, you are looking for a used car, and the dealership shows you two gorgeous identical cars listed at the same price. The only difference, the Carfax reports show one of the two cars was once involved in a car accident at some point. Which car would you buy?
A recent consumer survey indicated 55% of potential buyers would never buy a vehicle with a prior accident history. Additionally, those surveyed that indicated they would buy a wrecked vehicle said they would have to be given a large discount to make the purchase. In many instances, not only should the insurance company pay to repair your vehicle but they should also pay you for your vehicle’s diminished value. Valid claims should always be pursued. In many cases, I’ve seen diminished value claims worth several thousand dollars.
2. Has my vehicle suffered diminished value?
The short answer is that depends. If before the accident your vehicle was relatively new, in good condition, with no significant prior accident history, with significant current property damage then you certainly have a diminished value claim. The value of the claim will vary based on numerous factors. For example, $5,000 in repairs for collision damage will have a larger impact on the value of your car than $5,000 in repairs to paint over cosmetic damage. Along those same lines, if your vehicle already had a significant accident history, suffered minimal accident damage, then your claim will probably have little or no value. Most lawyers offer free consultations. If the insurance company is making you a diminished value offer that seems too low, it might be a good idea to contact a lawyer for a free consultation.