Diminished Value is the difference in price from a comparable unwrecked car, and your car after an accident.
You may be entitled to a check from your insurance company for diminished value. Diminished value is the automatic loss in value from a collision. Almost every vehicle that has been in a wreck will have some form of inherent diminished value.
Many car shoppers would not buy a car that had been in an accident, regardless of the price. A few would purchase your car that had been in a wreak provided they were given a sizeable discount.
Auto Insurance companies do not pay for diminished value and hire independent appraisers that will work hard for their bosses to minimize claims. In their online article "Diminished value fact or fiction?," State Farm tries to discourage consumers from attempting to recover diminished value.
When a demand for diminished value is made, insurance companies may deny diminished value has happened. Some insurance companies give adjusters scripts to help them lower the value of claims. When making a diminished value claim, you'll have to prove a loss in value has occurred. We recommend you contact your own independent appraiser, that works for consumers, not the big insurance carriers.
Your one-year-old vehicle is worth $40,000. Someone hits you and your car is repaired. Other comparable cars are being sold for $35,000. You decide to sell several months after your car is repaired. A potential seller finds out about the collision and offers you $26,000, or worse yet, refuses to buy. In a best case scenario, the difference in diminished value and an undamaged vehicle would be $9,000. A good independent appraiser that can prove this claim, could get you an extra $9,000 for the diminished value of your car.
Comparable Car Value (unwrecked)
$35,000
Wreaked cars comparable value
-$26,000
Difference in diminished value
=$9,000
Many times a frame or structurally damaged vehicle can not be sold as a "certified used vehicle." This will impact the vehicle's value by as much as 30% to 70%!
When you got to sell your vehicle, most smart buyers will ask is "has it ever been in an accident?" Dealers will know from the VIN the car has been in an accident. Even if you didn't disclose the accident, buyer now often pull vehicle history reports from Carfax.com and other services. When you reported the accident to the DMV, that's when the crash went onto your vehicle history report.
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