If there is one thing any automobile driver doesn’t want to experience, it’s being in an accident. When this happens, they are suddenly facing many issues, one of which is getting their vehicle repaired. However, even after the repairs have been made, it’s likely the vehicle’s value will be diminished substantially, now that it has a verifiable accident history. While this sounds as if there is nothing you can do about this, the fact is your car insurance may provide you with a way to recoup your losses. Known as a diminished value claim, this special type of claim is often little-known by most policyholders but can be an effective tool in the event your vehicle is involved in an accident. To learn the correct way to file a diminished value claim, here are the steps to follow.
Get an Appraisal
Since a diminished value claim will pay you the difference between the value of your vehicle pre-crash and once it has been repaired, the first step in filing a diminished value claim is to get the vehicle appraised. This can be done online by going to sites such as Edmunds or Kelly Blue Book, or by making an appointment with a local car dealership. In either case, don’t expect to get as much as you would hope for during the appraisal. Since about 70 percent of used cars are sold to dealers, it’s likely a dealer will quote as low a value as possible, so be prepared. Additional details about this can be found here.
Asking for Compensation
While getting an appraisal may be a bit time-consuming and frustrating, the hard part is yet to come, and that involves asking the at-fault driver’s insurance company to provide compensation. Expect this to be a negotiation process, and one that could drag on for weeks or months. While some insurance companies will acknowledge the existence of a diminished value, others may not, and instead attempt to give you a small amount of money based on an industry formula they won’t disclose to you. If this happens, you’ll have two choices. Either you can take the money they are offering you and walk away, or you can hire a lawyer and take the insurance company to court. You can learn more about this process by visiting here.
Make Sure it’s Worth Going to Court
While it’s only natural to want as much compensation as possible for your vehicle, it’s also important to make sure it will be worth the effort to go to court. For example, unless you own a new or very expensive car, the cost and hassle of going to court may not be the smart decision to make. In many cases involving diminished value claims, the cars involved are older models that have low appraisal values. Because of this, the cost of legal fees and court costs may end up being more than what you will receive in compensation. In addition to this, most claims in these situations fall below the levels of small-claims court, meaning you will be able to represent yourself in court if you desire. According to most attorneys who have handled diminished value claims, unless a vehicle is worth more than $10,000, it’s simply not worth it to pursue legal action.
Uninsured Motorists Claims
If your accident was caused by a driver who has no car insurance, you may actually have a better chance of having your claim paid by your insurance company. This is due to state laws, which tend to require insurance companies to pay these claims out of the uninsured motorist part of your insurance. However, there are generally very few instances when the driver who causes your accident is uninsured, so don’t count on this happening in your case.
While it may seem perhaps a bit unfair to think you will not be compensated for your car’s value if someone else causes the accident, the good news is that for those who do choose to pursue diminished value claims, they often receive adequate compensation. By getting an appraisal, looking over your insurance policy, and speaking with both an attorney and insurance company representatives, you’ll know the best path to pursue.