Car Insurance Claim

How to Make a Diminished Value Car Insurance Claim

If your vehicle sustained damage in an accident caused by someone’s negligence, that person’s insurance company must pay to repair the damage. However, repairs do not necessarily restore the car to its pre-accident value.  

In New York, the other side’s insurer handles your diminished value car insurance claim. The value of your claim will be for the diminished monetary value of your vehicle, known legally as diminution, which is the quantifiable loss in fair market value subsequent to being repaired after a collision.

What Is a Diminished Value Car Insurance Claim?

The value of your vehicle diminishes after an accident as compared to an identical vehicle that was never involved in an accident. This is true even after you have the vehicle fully repaired.

The perception of a buyer about a car’s post-accident value is the source of the diminution phenomenon. Buyers may express concern about the car’s safety and reliability, or whether any latent issues remain unaddressed.  

Car history reports allow a potential buyer (or dealer, if you opt to trade-in your vehicle) to see whether your vehicle previously sustained damage in a crash as well as whether you had the vehicle towed after the accident.

Even if you had your car repairs done at the dealership, consumers understand that this does not guarantee a trouble-free future. So, given the chance, buyers will almost always choose the non-accident car, all else being equal.

Because a previously wrecked vehicle carries a stigma that makes it difficult to sell, your car will have a significantly smaller value compared to the equivalent vehicle that never sustained crash-related damage.

How Do You File a Diminished Value Car Insurance Claim?

The process for filing a diminution claim is essentially the same as it is for claiming repairs and other damages, typically submitted to the at-fault party’s insurance adjuster. In some cases, you must deal instead with the insurer’s attorneys — especially if your claim has a high dollar value.

In many cases, the insurance company will initially refuse to consider a diminished value claim, or it will offer a small sum as compensation for your value loss. Building a strong case will help prevent an unnecessary claim denial.

What Is Required to Prove a Diminished Value Car Insurance Claim?

To succeed in collecting a diminished value settlement from the at-fault driver’s insurance, you or your car accident lawyer must provide sufficient support for your claim. This includes proof that your vehicle’s value has, in fact, diminished, and by how much.

The specific approach for proving diminution typically involves obtaining a formal report and opinion from a certified vehicle appraiser in your area. The appraiser will provide an estimated value of your vehicle if it had not sustained damage and its value after the accident and repairs.

Some collision damage repair providers may offer to give you estimate of value for your car with and without having undergone damage and repair. However, insurance companies will rarely accept a body shop’s assessment.

We have access to appraisers who are qualified to estimate diminution in a way that is satisfactory to the at-fault party’s insurance company.

When Am I Eligible to File a Diminution Claim in New York?

The New York statutes allow accident victims to file a diminished value car insurance claim and to pursue settlement from the at-fault driver or their insurance company.

If, however, your auto insurance policy specifically excludes diminution from your coverage, you likely cannot file a diminished value car insurance claim from your own carrier. Consequently, if your negligence caused an accident, you cannot pursue a settlement for diminution.  

What Is the Value of Your Diminished Value Car Insurance Claim?

Depending on the vehicle, your diminished value could range from a few hundred to several thousand dollars.

Factors that your car accident lawyer must consider are the year, make, and model of your car, how many miles your car has on it, and the type and severity of prior damage.

If you own a luxury vehicle, your claim’s value may be substantial. Luxury car buyers will rarely purchase a used vehicle that previously sustained serious damage in a crash.

Get Help with Your Diminished Value Claim Today

The Gacovino, Lake & Associates, P.C. team understands the challenges inherent in pursuing a diminished value claim after an accident. For that reason, we offer a complimentary, no-obligation consultation to discuss your case and evaluate the potential of successfully obtaining compensation.

Contact our office today at 631-600-0000 to schedule an appointment with one of our Long Island car accident lawyers.

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