Even though being in a car accident is scary and devastating, but the accident itself is rarely the end of the story. After a car accident you will most likely be overwhelmed with phone calls from insurance agencies and the police which certainly adds a bit more stress to the whole situation of losing your car.
Depending on the state you live in, you might be entitled to receive compensation for the pain and suffering due to your accident. Some courts even state accident law are mostly focused on making the accident victim whole by ‘forcing’ the person at-fault pay.
But with all the things happening around the accident, how can someone know if they are treated fairly or not? Is there a way to know that the compensation offered will be sufficient?
After an accident, many accept only a portion of the compensation they are entitled to. And there are rarely situations where the person at-fault or the insurance company will offer a sum that will really make the victim whole.
Diminished value of your vehicle should be included into the compensation. We all know that cars that were in accidents or have an extensive repair history have a lower value. And this is something you can now check with a few clicks.
Some car dealership managers will diminish the value of your car by almost 30% after a simple frame damage repair. This means that if your car’s value is $20,000 you could ‘lose’ about $6,000 in value.
Diminished value claim
Claims for diminished value should be made as soon as possible. Just like with all other claims after a car accident, there is a certain statute of limitations. For Arizona, the statute of limitations is 2 years. So this means that the victim of the car accident has 2 years (after the accident) to submit a diminished value claim in order to be compensated for his/her loss. But there is one thing you need to be aware of.
When you’re dealing with settlements after your car accident you need to be aware that these settlements usually contain an exclusion clause which prevents you for making additional claims such as diminished value. So if you don’t file a claim upfront, you won’t be able to later on.
That’s why it’s important to handle all claims upfront and a skilled and experienced attorney will be able to help you with this. If you’ve been in an accident recently and would like to file a claim and be compensated, contact Schenk Podolsky and let us help you.
Schenk Podolsky Personal Injury Attorneys
4140 E Baseline Rd #101, Mesa, AZ 85206
Imagine that you are sitting in your vehicle waiting for a traffic light to turn green when all of a sudden you feel the abrupt and unexpected crunching impact of the vehicle behind you come crashing into the rear bumper and trunk of the brand new 2016 BMW 535i you just drove off the lot. Now, what?
After filing claims and haggling with insurance companies, and approximately $10,000 worth of repairs, you decide you purchased the BMW on impulse and you no longer want it. You most certainly do not want it now that it has been in an accident. You return it to the dealership and listen to the dealer explain that even though your BMW appears as sweet as the day you drove it off the lot, because of the accident, its value has been severely reduced by at least $15,000!
Can you recover the diminished value of your vehicle after it has been in an accident that was not your fault?
What is Diminished Value?
Diminished value is the difference between what your vehicle or property was worth before an accident and what it is worth after repairs. Less than 5% of people who attempt to re-sell a vehicle understand diminished value. Diminished value relates to collision damage. Such damage is permanent because of modern-day manufacturing methods in the auto industry. Vehicles are built on uni-body construction as opposed to a frame used in prior times. With each panel welded and engineered for a specific shape the vehicle is structurally stronger as a result. Even though a shop can restore the appearance of your vehicle, it will be impossible to restore it to its factory condition. Arizona does allow individuals to receive compensation for diminished value claims if their vehicle has been in an accident. However, because of their subjective nature, diminished value claims must be proved.
Three types of diminished value in Arizona
- Immediate diminished value is the loss of value that results just after an accident takes place and based on the difference between market value before the accident and what its value is after sustaining damage.
- Inherent diminished value is the loss of market value due to a vehicle being in an accident and remains after the vehicle is professionally repaired. It is the loss of value due to the accident. Place two identical vehicles next to each other on a dealer’s lot and people will always buy the undamaged one.
- Repair related diminished value refers to additional loss that occurs because of improper or incomplete repairs or inadequate repairs. This could include simple aesthetic damages, as well as major structural shortcomings.
Can you recover diminished value?
Diminished value claims are a bit touch and go. As mentioned, the burden of proof is on the one filing the claim. The best way to a cash settlement is to go after the “at fault” motorist’s insurance company. Before we can determine if you have a valid diminished value claim we are going to want to know a few things about you and the vehicle.
- What is the year, model, and make of your vehicle?
- What was the mileage and condition of your vehicle before the accident?
- How damaged is your vehicle?
- Has your vehicle been involved in any other accidents?
- Were vehicle repairs up to factory standards?
- Have you been unable to sell your vehicle after repairs?
- What was your vehicle worth before the accident?
- How do you prove diminished value?
Do you need an attorney?
In Arizona, you are welcome to state the market value of your vehicle before and after the collision but third-party insurance companies will not accept what you say as evidence. We recommend consulting an expert Diminishing Value Attorney. Insurance companies do not like to deal with diminished value claims. They claim diminished value is too speculative. Not all attorneys have diminishing value claim experience. With Shenk and Podolsky, Attorneys at Law of Mesa, Arizona, you will get the compensation you deserve. If you have been in an accident, call Shenk and Podolsky for a free consultation at 480-355-1310.
When your car gets damaged in an accident it can negatively affect its value. Even if it has been repaired, your accident history can affect how much your car is worth when you decide to sell or refinance it in the future. Diminished value is how much value your car loses after it has been damaged in an accident.
Calculating Diminished Value
A few different factors go into calculating your car’s diminished value.
- Of course before you find out the diminished value of your car, you have to find out how much your car is worth depending on the year, make, model and mileage.
- Once you know the value of your car, say it’s worth $15,000, you can calculate the base loss of value. Insurance companies usually divide the value of your car by 10. If you use this calculation, then the most you can lose due to diminished value is $1,500.
- After your base value is calculated, a value will be set based specifically on your vehicle. Your car will be given a number between 0.0 and 1.0 based on how much damage was done to your car from an accident. That number will be multiplied by the base value. If your car had moderate damage, 0.5, the diminished value would be adjusted to $750.
- Your car’s diminished value will then be determined based on its mileage. If your car has over 100,000 miles on it, the diminished value from the above answer would be multiplied by 0, remaining at $750. If your car had only 20,000 – 39,000 miles on it, you would multiply the above value by 0.8, adjusting your diminished value to $600.
The number you have after the above steps is your car’s final diminished value. It may be calculated by your insurance company, the buyer or car dealership. Although they may use different numbers to come up with their totals, these are the factors that go into calculating your car’s diminished value.