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Thread: How to claim diminished value? Car accident...

  1. #1
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    Default How to claim diminished value? Car accident...

    So 3 weeks ago, we traded in my Audi A3 for a CPO'd '07 Honda Odyssey EX-L that is now the wife's ride (spare me the grief, I feel immasculated enough). We paid $24K for it. Last week, traffic came to a sudden halt on the freeway, and she was rear ended and then pushed into the car in front of her as well. The rear bumper and liftgate were toast, and the front bumper, A/C condenser, and radiator also bit the bullet. All parties were okay, and the police report holds the driver behind her accountable.

    The question I have is around diminished value. The damage tally came in at $6,600, and our insurance should be hopefully going after the other (17 year old of course) driver's insurance to pay our deductible. However, what's the best way to also factor in diminished value? Naturally, if we were ever to sell the car, Carfax would show the car has been in an accident, and we'd have to take a hit on resale. I came across www.dvassess.com, which you can pay them to provide a report that shows how much value the car has lost. Is this something I should handle myself? Or am I better off paying for a 3rd party report and using that as leverage with the insurer?

    Would be nice to have at least gotten the temporary tags off the van.



    Jim H
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  2. #2
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    Some states do not allow you to recover this, I know New York is one of those. Not sure about NC, but definitely something to check into before you invest too much time in it.
    09 Mazda 6i Sport 6MT

  3. #3
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    This is funny.

    When our SVT Focus was wrecked last year, I had no idea there was even anything called "diminished value", or that insurance companies recognized it.

    My SVT was valued at 10k, and the repair bill was about $6k, and they were going to fix it. I told my adjuster that I JUST BOUGHT IT and still owed $8000 on it, and I didn't want to have the car fixed, as the loan amount would SERIOUSLY OUTWEIGH the value of a repaired car with damage that extensive. I could never sell the car, or trade it in, for any kind of fair value, so unless I kept the car forever, they were basically stealing money out of MY pocket and hoping I wouldn't notice. The adjuster was a douchebag, and blew me off, so I sent a complaint letter to the insurance company (Nationwide), and they came down from upstairs and decided that, since I'd expressed my concern about diminished value, they would go ahead and total out the car.
    2000 Roush Cougar MTX V6
    2003 SVT Focus ZX3 #2370
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  4. #4
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    Quote Originally Posted by Pete D View Post
    Some states do not allow you to recover this, I know New York is one of those. Not sure about NC, but definitely something to check into before you invest too much time in it.
    I think NC does permit DV. Here's what I found when nosing around: http://www.csiofnc.com/diminished_value.html

    New Diminished Value Law in North Carolina

    G.S. 20 279.21 on Diminished Value in North Carolina (http://www.ncleg.net/Sessions/2009/B...PDF/S660v7.pdf) is “An Act to Provide an Alternative Method of Determining Property Damages as a Part of Motor Vehicle Liability Insurance.”

    First, I would like to say the way the new law is written, it will cause more work on the appraiser’s part and in turn, it will drive up the cost of Diminished Value appraisals. In addition, the auto insurer can still reject the amount of Diminished Value determined, which can force the matter to be settled in court. The nice thing about this new law is that it reinforces the “N.C.P.I.─Civil 106.62 Property Damages─Diminution in Market Value,” as I have shown above, and I’ll repeat here:

    (1) “The actual property damages are equal to “the difference between the fair market value of the property immediately before it was damaged and its fair market value after it was damaged.”

    G.S. 20 279.21 (1) “The claimant and the insurer fail to agree as to the difference in fair market value of the vehicle immediately before the accident and immediately after the accident;” and… [continued in (2) below].


    The second thing I like about this new law is that it forces auto insurers to recognize the National Automobile Dealers Association Pricing Guide Book on vehicle values. Many auto insurers refuse to recognize the NADA guide when there is a payment for a total loss. Auto insurers will use other vehicle valuations that are not available to the public and are generally $1,500 or more under the NADA value of the vehicle.

    [G.S. 20-279.21, continued:]

    “The difference in the claimant's and the insurer's estimate of the diminution in fair market value is greater than two thousand dollars ($2,000) or twenty-five percent (25%) of the fair market retail value of the vehicle prior to the accident as determined by the latest edition of the National Automobile Dealers Association Pricing Guide Book or other publications approved by the Commissioner of Insurance, whichever is less, then on the written demand of either the claimant or the insurer, each shall select a competent and disinterested appraiser….”

    NO MORE Inherent Diminished Value is the result of this law, as I see it. I have to wonder how auto insurers are going to handle this situation in determining a vehicle’s Diminished Value. I expect they will keep doing business as usual, refusing to recognize the new law. So when the auto insurer claims your vehicle’s diminished value is X amount, just ask them to show you how they came up with their numbers. If they say, “It’s a percentage of the repair cost,” or “It’s a percentage of the vehicle’s value” or they use the “Georgia 17C formula,” then tell them no thank you and just follow the new law.
    Jim H
    95 Midnight Blue SE (Sold)
    98.5 Silver Frost E1 (Sold)
    '04 G35 6MT Sedan (Sold)
    '01 Aurora 4.0 (Sold)
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  5. #5
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    Quote Originally Posted by Andy Bennett View Post
    This is funny.

    When our SVT Focus was wrecked last year, I had no idea there was even anything called "diminished value", or that insurance companies recognized it.

    My SVT was valued at 10k, and the repair bill was about $6k, and they were going to fix it. I told my adjuster that I JUST BOUGHT IT and still owed $8000 on it, and I didn't want to have the car fixed, as the loan amount would SERIOUSLY OUTWEIGH the value of a repaired car with damage that extensive. I could never sell the car, or trade it in, for any kind of fair value, so unless I kept the car forever, they were basically stealing money out of MY pocket and hoping I wouldn't notice. The adjuster was a douchebag, and blew me off, so I sent a complaint letter to the insurance company (Nationwide), and they came down from upstairs and decided that, since I'd expressed my concern about diminished value, they would go ahead and total out the car.
    I highly doubt your SVT was valued at 10k, what did you get as a settlement? Lets say it was, if your estimate came to $6k that puts you at 60%. Most states provide a Total loss threshold from 70-80% saying if its going to cost 70% of the value of the car to repair, the vehicle is a total loss by law. So your car in reality was only about $1k from being a total loss. And if you had a $6k estimate on a Focus its safe to say it was open ended and there was likely much more to be added to the estimate once the vehicle was torn down for repairs. So it wasn't a high and mighty decision by the insurance company. It was just common practice.
    NC does honor diminished value. Few states do because if your car was repaired by industry standards, it should be the same quality or better than before it was in an accident. Even if you do get diminished value and keep the vehicle, keep photos and the paperwork from the repairs to show the next buyer what happened. If you do that, you should't lose any $$ on the sale since this is mainly cosmetic. Also go to one of the shops that your INSURANCE company provides that offers a lifetime warranty of the repairs. (its industry standard these days).
    Edit: sorry I didnt answer the question by the OP, I used to handle insurance claims but never handled a diminished value state. But there are plenty of articles on the interweb about it.
    2000 SVT Black/Tan #1163/2150 SOLD
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  6. #6
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    Quote Originally Posted by CarpePoon View Post
    I highly doubt your SVT was valued at 10k, what did you get as a settlement?.
    I got nearly $11,000 from the insurance company for it, by the time everything shook down.

    Nationwide's threshold is 75%.

    The shop had actually already started the work on it, and then Nationwide pulled the plug when I contacted the head office.

    Believe me, it was low-mileage, and IMMACULATE. I thought they were inflating the value to miss the threshold, but they stood behind it, and paid out that much and then some.
    2000 Roush Cougar MTX V6
    2003 SVT Focus ZX3 #2370
    2008 Mustang Bullitt # 5389

  7. #7
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    Quote Originally Posted by Andy Bennett View Post
    I got nearly $11,000 from the insurance company for it, by the time everything shook down.

    Nationwide's threshold is 75%.

    The shop had actually already started the work on it, and then Nationwide pulled the plug when I contacted the head office.

    Believe me, it was low-mileage, and IMMACULATE. I thought they were inflating the value to miss the threshold, but they stood behind it, and paid out that much and then some.
    Thats awesome then. Believe me, insurance companies want to see cars repaired. But when it starts getting near the threshold (especially on older cars) it opens up a can of worms. All it takes is a click of a button in the claims handling end to push it off the total loss cliff and sometimes it just makes sense to do so. You get people who demand that their car gets fixed when its at 235% and you get some that refuse to let you repair it when its at 7%. (I had both happen to me as a rep)
    2000 SVT Black/Tan #1163/2150 SOLD
    2007 Grand Prix GXP 5.3l V8 342hp/358tq
    2009 Saturn Vue Redline V6 AWD
    2014 GMC Acadia Denali AWD

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