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.