Diminished value: why a repaired car can be worth less
How an independent vehicle appraiser sees it
Figure out which kind of claim you have
In many cases, owners seek diminished value from the insurer of the driver who was responsible. Your own policy may cover it differently or only in a limited way. Ask the claim handler what type of claim you have. Also ask whether the insurer will consider diminished value. Don’t count on a formula or a generic online estimate to prove your loss. [1, 2]
Collect evidence that supports your case
Keep photos of the crash damage, plus the repair estimate, supplements and final invoice. Write down the car’s mileage, options, condition and any earlier damage from before the crash. Compare sales of similar vehicles that do and don’t have a similar damage history. If you pay for an independent appraisal, ask which market data the appraiser will use and what it will cost. [1]
Make a clear, focused request
Send a brief explanation of the loss you’re claiming, along with your records. Ask the insurer to respond in writing to your evidence. Some cars may show little loss that can be measured. Examples include a car with earlier damage, high mileage or only a small cosmetic repair. Weigh what the claim is likely worth before you pay for expert work. [1, 2]
What to ask an appraiser
- What market evidence from comparable sales supports this amount?
- How did you factor in earlier damage and mileage?
- How much does the appraisal cost?
Check whether the insurer will accept a claim
Before anything else, find out whether the insurer will take a diminished value claim for this loss. [1]
Sources and further reading
- 1Washington insurance commissioner, diminished value claims
- 2Texas Department of Insurance, diminished value bulletin
General education from a vehicle appraiser’s perspective. Who qualifies and how value is figured vary by state, policy, fault and claim type. You’ll need evidence of an actual loss to make a claim.
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