Getting into a car accident is stressful enough, but even after your vehicle is repaired, its value may not fully bounce back. This reduction in value, called diminished value, can hurt your wallet when it’s time to sell or trade in your car. Fortunately, you may be able to recover that loss, if you know the right steps to take.
What is Diminished Value?
Diminished value refers to the loss in a car’s market value after it has been damaged and repaired. Even if the car looks brand new and drives just fine, buyers tend to pay less for a vehicle with an accident history. Think of it this way: would you pay the same for a used car that’s been in a collision as one that hasn’t? Most people wouldn’t, and insurers know that.
Types of Diminished Value
There are three types: immediate, inherent, and repair-related. Immediate diminished value occurs right after the accident but before repairs. Inherent diminished value is the most commonly claimed, it’s the permanent loss in market value even after proper repairs. Repair-related diminished value happens when the repairs are subpar or use non-original parts. Knowing which type applies to your case can help you build a stronger claim.
Who Can File a Diminished Value Claim?
If you weren’t at fault in the accident, you’re in a strong position to file a Florida diminished value claim against the at-fault driver’s insurance. In some states, even if you were partially at fault, you may still qualify for compensation. Unfortunately, most insurance policies don’t allow you to claim diminished value through your own insurer unless it’s an uninsured motorist situation, so knowing your state’s laws is crucial.
Step 1: Get the Car Repaired First
Before anything else, get your vehicle repaired at a reputable shop. Keep detailed records of all work done, including invoices, parts used, and photos of the damage and repairs. These documents will be important evidence when filing your claim. If possible, insist on original manufacturer parts (OEM) instead of aftermarket replacements.
Step 2: Get a Diminished Value Appraisal
Once your car is fixed, hire a professional appraiser who specializes in diminished value. They’ll inspect your vehicle, review its accident history, and provide a written appraisal estimating how much value your car has lost. While this service often costs money upfront, a solid appraisal can greatly strengthen your claim.
Step 3: File the Claim Promptly
Submit your diminished value claim to the at-fault driver’s insurance company as soon as possible. Include your appraisal, repair records, and a demand letter that outlines your loss and the amount you’re requesting. Some people successfully negotiate on their own, while others prefer to have a lawyer or claims expert handle the communication.
Step 4: Be Ready to Negotiate
Insurers may push back, offering a lower amount or rejecting the claim entirely. Don’t be discouraged. Review their response carefully, and if needed, counter with additional evidence or get a second opinion. If negotiations stall, you can file a complaint with your state’s insurance department, or consider legal action if the amount justifies it.
When to Bring in Legal Help
If the insurer isn’t cooperating or the diminished value is substantial (especially with high-end or newer vehicles), consulting an attorney may be worthwhile. Many lawyers offer free consultations and only charge if you win your case. In some situations, small claims court can also be a cost-effective option.
Final Thoughts
Recovering the diminished value of your vehicle takes a little effort, but it can be well worth it, especially if your car has lost thousands in resale value. Stay organized, do your research, and don’t settle for less than your car is truly worth. After all, your vehicle may be repaired, but your wallet shouldn’t be permanently dented.