Most people focus on repair bills after a crash and never account for the diminished value of the vehicle. Even after quality repairs, a car that has been in an accident is worth less than an identical car that has not — and if someone else caused the wreck, that lost value can be recovered.
What diminished value is
Diminished value is the difference between a vehicle’s market price before an accident and its price after repair. If you try to sell a repaired car and buyers will not pay full market price because of its accident history, the value has diminished. This happens even when the car receives quality repairs with original-manufacturer parts.
The reason is simple: there is no guarantee that replacement parts match the quality of the originals, and buyers cannot be certain the car will not develop problems later. The accident record alone makes the vehicle worth less.
When you can file a claim
Most insurance policies do not allow a diminished value claim against your own insurer. That bars recovery when you were at fault for the accident. But if you were the victim of a crash someone else caused, you can pursue a diminished value claim against the other driver’s insurance.
How to file a diminished value claim
- Gather documentation. Collect the police report, repair invoices, and photographs of the damage and repairs. Preserving evidence after any car accident also helps prove you were not at fault.
- Obtain a diminished value appraisal. Not required, but it helps. An appraiser evaluates the vehicle’s pre-accident and post-repair values to fix the diminished amount in dollars.
- Contact the insurance company. Notify the at-fault insurer that you intend to file a diminished value claim and ask about its specific process. Letting an experienced firm handle communications can improve the outcome.
- File the claim. Follow the insurer’s instructions, which may include completing a form and submitting supporting documents.
- Negotiate. Insurers commonly offer less than you requested. You can accept the offer or push for a higher amount supported by your appraisal.
- Consult a lawyer. If you cannot reach a fair settlement, a legal team can advise on whether to pursue a lawsuit.
File it the right way
A diminished value claim can be straightforward or genuinely complicated, and insurers are quick to ignore or deny claims that arrive without solid documentation. If you do not want to navigate the process alone, an injury lawyer who handles car accident claims can value the loss, assemble the proof, and handle the negotiation.