Aleksey Katmissky | October 26, 2020 | Car Accident

Individuals are shocked to learn they might not receive the full value of their property damage claim after a car accident. Insurance companies cheat victims out of thousands of dollars in damages because they do not know how much their accident claim is worth. If a person is not familiar with diminished value accident claims, the insurance company can save money by remaining quiet. 

The insurance company knows it cannot pull these tricks and use unfair tactics when a car accident attorney is involved in the case. It is more difficult to try to engage in bad faith insurance tactics with a lawyer. The lawyer understands what types of damages the victim is entitled to receive and how much the claim is worth.

What is a Diminished Value Accident Claim?

When a car is wrecked, the person who caused the car or truck accident is responsible for the damages caused to the vehicle. In most cases, the insurance provider for the at-fault driver handles the property damage claim.

If the vehicle can be repaired, the insurance company pays to repair the vehicle. When the vehicle is a total loss, the insurance company pays the owner an amount that equals the vehicle’s fair market value at the time of the crash. When a vehicle is repaired, the property owner can also file a diminished value accident claim.

Diminished value equals the difference between your vehicle’s value before the accident and the value of your vehicle after it is repaired. If you were to trade in your car after it was repaired, the car dealer would likely offer you less money because the vehicle was in an accident. If you sell the car to a private party, you will likely receive less money if the person researches the car’s collision history through CarFax or another service.

Unfortunately, many insurance companies refuse to pay diminished value accident claims. They know that many attorneys do not handle property damage claims. Most lawyers only handle property damage claims as part of an accident claim involving severe injuries.

However, that does not mean you should give up if your accident involved minor injuries that do not require a personal injury lawyer’s assistance.

What Can You Do to Protect Your Rights Regarding a Diminished Value Accident Claim?

Knowledge is one of the best tools you can use to fight for compensation for diminished value. Preparation is another tool that can help. 

Obtain estimates from car dealers to prove that your vehicle’s value decreased because of the motor vehicle accident. The estimate should include what the car would have been worth before the collision and what it is worth now that the repairs are complete. 

Armed with your estimates, file a diminished value accident claim with the insurance provider. Request an amount equal to the highest estimate so that you have some room to negotiate a fair settlement.

What Happens if the Insurance Company Refuses to Pay the Claim?

If the insurance company refuses to pay a diminished value accident claim, you must decide whether the claim is worth pursuing in court. If the amount is small, it might not be worth your time and effort to file a lawsuit. However, if the value is substantial, you might want to pursue a court action.

Filing a lawsuit lets the insurance company know that you are serious about pursuing the claim, even if you do not hire an attorney and file the claim yourself through small claims court. The small claims court may have forms and instructions for preparing, filing, and serving the lawsuit on the other party, but it cannot give you legal advice nor tell you how to argue the case in court. 

If you decide to file a lawsuit for a diminished value accident claim, you must do so within three years of the accident date. Missing the deadline means that you give up your right to file a claim. 

Do Not Let the Insurance Company Take Advantage of You

Insurance companies treat claims involving a lawyer differently from claims handled by the victim. The company wants to limit how much it must pay to settle a claim. When the victim handles the claim without an attorney, the company tries to lower the claim value, including claims involving personal injury damages. 

Ensure that you understand all of the car accident damages you are entitled to receive before you sign a settlement agreement. Once you settle a property damage claim or a personal injury claim, you cannot demand more money, even if you would have been entitled to that money as part of your claim.