What you Need to Know About Diminished Value Claims
Understanding diminished value claims can help you to get your life back on track as effectively as possible after you have been in a car accident. Diminished value claims help you to recover a loss of value for the vehicle when the other driver caused the accident. In general, your vehicle will lose a substantial amount of value purely because it now has a history of damage. Even with the best possible repairs made using parts from the manufacturer, your vehicle will still have reduced value. Understanding how to navigate the diminished value claims process can help to ensure that you receive all of the compensation that you are entitled to.
What is a Diminished Value Claim?
A diminished value claim is a way to recover a drop in your vehicle’s value after you have been in an auto accident. It is important to note that diminished value claims are generally only an option if you were not at fault for the accident. When you work with our team at Utah Accident Solutions, we can help you to identify the best approach to get your life back on track after you have been in an accident, including navigating the diminished value claim process when necessary.
Diminished Value is Different from Depreciation
Many people get confused between depreciation and diminished value. Diminished value is the loss in value that occurs to your vehicle after it has been damaged. Depreciation is the natural loss of value that the vehicle experiences as it ages. When you are navigating a diminished value claim, it is important to remember this difference so that you know what value you are calculating.
How to Collect Diminished Value
If you decide to pursue a diminished value claim, it is usually collected from the insurer of the party that is at-fault. The insurance company has a general formula that they use to calculate diminished value for your vehicle. It can often be helpful to consult with a third party to ensure that you are able to get an accurate number for the diminished value of your vehicle.
When to Pursue a Diminished Value Claim
There are several things that you will want to consider to help you make decisions about pursuing a diminished value claim. Diminished value claims are usually only applicable when the other party is at fault for the accident. Most insurance policies forbid the filing of a claim for diminished value against your personal insurance company, except in very specific circumstances. For example, when the at-fault party was uninsured, you may be able to file a diminished value claim under your uninsured driver coverage. It is also important to remember that there is a statute of limitations that will impact the validity of your claim. While this is often a matter of years, depending on the state, it is beneficial to pursue your claim as quickly as possible following your accident. In Utah, there is a 3 year statute of limitations.
Many people think that it is necessary to wait until they sell their vehicle to pursue diminished value compensation. However, we recommend that people pursue diminished value compensation first; there is no need to wait until you are ready to sell the vehicle. Requirements for a diminished value claim will often differ between states, so it is important to work with someone who is familiar with the process in your own state. In general, the vehicle can’t be older than 10 years old in order for you to receive compensation for diminished value. It is also important that the vehicle has been repaired and not declared a total loss. If the vehicle is declared a total loss, the insurance company should compensate you for the value of the vehicle prior to the accident. In addition, you must not have entered into a settlement with the other party if you intend to pursue a diminished value claim.
Should you Settle?
You should always consult with a professional before you decide to agree to a settlement with the other party. When you settle the suit outside of a court, you are essentially giving up any right that you have to file claims against the other driver or the other driver’s insurance company. This will prohibit you from filing a diminished value claim if it wasn’t initially included in the settlement. Have the settlement reviewed by a professional before you sign anything.
Get an Appraisal
When you are pursuing a diminished value claim, it is often beneficial to get an appraisal from a 3rd party. This 3rd party appraisal can help to provide you with leverage throughout the diminished value claim process. The right appraisal can go a long way toward ensuring that you are able to receive the compensation that you are entitled to.
Types of Diminished Value Claims
There are multiple types of diminished value claims, though inherent diminished value claims tend to be the most common. Inherent diminished value refers to the loss of value of the vehicle due to the history of damage. Immediate diminished value is the loss of value that the vehicle sustains immediately after the accident before the vehicle has been repaired. Since the insurance company typically covers repairs to your vehicle, immediate diminished value is usually not used. Repair-related diminished value refers to a loss of value that is due to low quality repairs that haven’t restored the original condition of the vehicle.
Work with an Expert
Diminished value claims can be complicated, despite being an important part of preventing an auto accident from completely derailing your life. When you work with our team at Utah Accident Solutions, you can be confident that you are taking the right steps to recover after your auto accident. This will help you to gain all of the compensation that you are entitled to and aid in getting your life back on track. With our services, you can minimize the total impact that the accident has on your life and focus on your recovery. If you think it is time to pursue a diminished value claim, our experts are happy to help you navigate the process. To learn more about diminished value claims or the related services that we offer, contact us at Utah Accident Solutions today!