Diminished Value Claim in Texas

Let’s face it.  A vehicle that has been repaired has a diminution in value compared to a vehicle that has never been damaged. 

Diminished value (also know as diminution in value)  means that something does not have the same value as it did before. In the context of a car accident, it means that a vehicle that was damaged in an auto accident will not have the same value after it is repaired than it did prior to the accident.

In Texas, not only are you entitled to get reimbursed for the cost of the repairs, you may also have a claim for the depreciation in the fair market value of your vehicle after the repairs are completed.  This is true even though the repairs were properly done.

In these pictures, you can see that the repairs are done quite well.  The vehicle looks like brand new again. However, once an insurance claim is made on a vehicle, it is placed into a data base which is shared throughout the entire marketplace.  In this day of CARFAX. AutoCheck, and other vehicle history reporting services, a car’s history is more documented than ever.  And potential car buyers rely on these reports when making a decision whether to buy a certain car or not.  Additionally, an accident might void the manufacturer’s warranty and even effect the car’s trade-in value.

It is for these reasons that a car that was damaged in a wreck suffers a certain stigma which will decrease its value no matter how well the car was repaired.

Thinking about making a diminution claim for your vehicle?

Get the proper appraisal.

Once the vehicle has been completely repaired, it must be appraised by a certified vehicle appraiser.  The vehicle appraiser will inspect the vehicle and analyze the repairs that were done.  Of course, the more extensive the the damages to the vehicle (such as frame damage), then the greater the diminished value of the vehicle.

Age of the Vehicle.

Another factor to consider is the age of vehicle.  The newer the car, then the more likely it will have have a depreciated value after the repairs are completed.  So many times, I have had clients who have been involved in a car accident within a few months, or even weeks, of buying a brand new car.  Anyone can appreciate the frustration of having to repair their car so soon after making such a financial investment.

Previous Accidents or Claims.

If your vehicle has been involved in a previous accident or insurance claim, then it might be harder to make a diminution in value claim.  That is because a car that has been in a previous accident may not be so easy to evaluate for depreciation than a vehicle that has never been wrecked before.  But just because there was a previous accident or claim doesn’t mean you cannot make a claim.  It just might be harder to prove.

The Type of Vehicle.

The frustration is even greater if the vehicle is relatively expensive, such as a Mercedes Benz, BMW, Porsche, Cadillac, Corvette, Lexus, Infinity, Acura, and the list goes on.  The reality is that buyers of these types of vehicles tend to be far more discriminating.  That doesn’t mean that other types of vehicles cannot be the subject of a diminution claim.  It just means that the more expensive the vehicle, the more likely it will suffer the stigma of having an accident reported.

The Appraisal Report.

Once the vehicle appraiser concludes an evaluation, a detailed and comprehensive report will be drafted.  The report will describe several matters:

• The type of vehicle and its features;
• The fair market value of the vehicle prior to the accident;
• The extent of the damages and repairs;
• A discussion of comparable vehicle values;
• An appraisal of the vehicle’s fair market value after the repairs

You have the right to make a claim.

Insurance companies do not like diminution claims and they tend to fight them quite aggressively.  Adjusters will go so far as to say that such claims are not recognized under the law, or even that you have to have a certain amount of repairs before you can make a claim.  In fact, if you are making a collision claim on your own insurance policy, there might be a exclusion for these claims.  But in a third-party liability claim, diminished value is recoverable.

These are the reasons why you should let an attorney handle your diminution claim.  If you would like to talk with a lawyer about your diminished value claim consult with us for free today!