What is Diminished Value (and why most PI firms don’t help with it)?
June 23, 2022
Diminished value (DV) is the cost of your car’s loss of reputation following an accident (we think it’s hysterical that a car has its own reputation, but that’s a joke for a different day). Even if your car is repaired by a quality and qualified professional to restore it back to its pre-accident condition, potential buyers won’t be willing to pay the same price. That difference in the pre-accident value of your car to the post-repair value of the car is how diminished value is calculated.
There are three types of diminished value.
Inherent diminished value is the most common form of DV after an auto accident. This type of diminished value is recognized as existing solely because the history of damage to the car will reduce its value on the market. This assumes repairs have been done correctly.
Immediate diminished value represents the difference in value of the car immediately following the accident before any repairs are made. This wouldn’t be applicable in most cases because insurance will cover the cost of repairs.
Repair-related diminished value is the loss of resale value to the car due to faulty repairs. This loss in value is beyond the reputational damage from the accident and can only be claimed in instances where repairs cannot be remediated.
In most cases following a crash a claim for inherent diminished value will be made. Each state has slightly different criteria for eligibility and calculation of DV but there are a few commonalities.
- There is a cutoff for age (often 7-10+ years) and mileage (typically 100k+)
- Age and mileage detract from the DV value
- Severity of damage to car increases the DV value
Recovering from an accident means being fully compensated for the damage to your (including its reputation). That’s why Mighty is here to help you with your property damage claim including getting you money for your diminished value claim. Money for diminished value is in addition to the cost of repairing your car; it’s money in your pocket. Your Mighty Guide and your attorney understand the rules in each state and will work with insurance to get you the settlement you are entitled to.
Mighty is using its data-driven, nerdy know-how to help people after an accident. Mighty Law lawyers charge lower rates and commit to a Code of Conduct that forbids behaviors typical among billboard injury attorneys, such as quid pro quos for referring people to their doctor friends. Plus, you can work with a Mighty Law lawyer at no cost for up to 60 days if no claim has been filed.
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At Mighty, we believe in helping our plaintiffs beyond getting them a fair settlement. Here are our tips on what you should do after you receive a settlement.
The answer is important, especially if you’re counting on the money from your settlement to pay for important bills. While every personal injury case is different, there are some guidelines around how long settlements take.