What Is Diminished Value?
Diminished value is the difference between what your vehicle was worth before an accident and what it may be worth after the accident, even after repairs are completed. In many cases, a repaired vehicle can still lose value because future buyers may pay less for a car with an accident history.
This loss can matter when you trade in the vehicle, sell it privately, refinance it, return a lease, or negotiate with an insurance company after a crash.
Why a Repaired Car May Still Be Worth Less
Repairs may restore a vehicle's appearance and function, but they do not always restore the vehicle's market value. A buyer may discount a vehicle if the accident appears on a vehicle history report, involved structural damage, required major repairs, caused airbag deployment, or resulted in non-original replacement parts.
That is why diminished value can be a separate issue from the cost of repairing the vehicle.
What Affects a Diminished Value Claim?
Several factors can affect the potential value of a diminished value claim, including the vehicle's pre-accident value, mileage, age, repair cost, accident severity, frame or structural damage, airbag deployment, prior accident history, quality of repairs, and whether another driver was at fault.
Generally, newer vehicles, lower-mileage vehicles, luxury vehicles, and vehicles with significant documented damage may have stronger diminished value arguments than older vehicles with high mileage or prior accident history.
Can Diminished Value Be Part of a Larger Accident Claim?
Yes. A car accident may involve more than the cost to repair the vehicle. Depending on the facts, a crash may also involve diminished vehicle value, rental car expenses, towing fees, medical bills, lost wages, pain and suffering, and other damages.
If you were injured in the accident, it may be important to review both the property damage side and the personal injury side of the claim before accepting an insurance settlement.
When Should You Speak With a Car Accident Attorney?
You may want to speak with an attorney if another driver caused the accident, the insurance company made a low offer, liability is disputed, your vehicle had major repairs, the accident caused frame or structural damage, airbags deployed, or you suffered injuries.
Landry Legal can review your situation and help you understand what claims may be available. Call (888) 914-0011 or email contact@landrypllc.com.