Short version: anyone have any experience trying to recover a diminished value claim?

Long version:

I'd like to hear from anyone with success in recovering a diminished value against the person who caused an accident. I've posted this saga in the wrong forums but heck, I'm new here and just getting the hang of the group. Sorry for the cross post.

Anyway, about a month ago my Rx-8 was hit by someone going the wrong way on a freeway on ramp. No one was seriously injured and that fact kept be happy for about a week driving something other than my RX 8. Then I got to thinking -- this was not my fault, even if my repairs are done perfectly, my car is not going to be worth as much. I waited a long time, saved my dollars, and did a lot of research before I finally took the plunge. This wasn't just my car, this was my RX!

The car is still in the shop. The repairs are fully covered by my insurance. I chose a good repair shop and the repairs promise to be very good (mostly replacement of a lot of non-structural suspension components and, of course body part replacement).

But even if the car is repaired 100%, it kind of tweaks me that it just is not worth as much as it was before the accident. Anyone who gets a carfax report will not pay as much as if there was no accident. Worse if it is not repaired 100% perfect. So I did some searching and thought I'd share with you all in case your rotary wonder is the victim of a crash caused by some unfeeling, low revving, car whose driver is yakking on the cell phone while driving the wrong way on the highway.

What I learned is that if you are in an accident that was not your fault, the rule basically is that you are entitled to be put in as good a position as before the accident. That includes the lost market value to your car (after repairs) due to the fact that it was in an accident (aka diminished value or DV).

Put another way, how much less would you pay for an RX-8 that has been in a particular accident compared to an identical RX-8 that has not? That number is DV. If you answer, "even if the repair was 99.9% perfect, I would pay $ X less", that $ X is DV.

There are different types of DV. "Inherent" DV is the lowered market value because of the accident repair (it assumes repair was done right). "Repair related" DV is the additional DV because of poor repair work (repair shop did not match the paint, or did not replace a damaged part, or did a poor repair job, etc.) "Insurance related" DV is the lowered market value because an insurance company did not cover things they should have, or that the policy allowed repairs that lower market value such as using after market parts.

Insurance companies seem to pretend that you cannot recover for DV. This is wrong. Insurance companies will fight and resist paying DV, but legally you are entitled to recover for all loss from the accident, and that will include DV. The problem is that your own insurance probably does not cover DV, so you are stuck with pursuing the claim on your own against the guy who hit you or, more likely, their insurance company.

The problem that I will encounter is proving the amount of DV and the even bigger problem of actually recovering DV from the other guy's insurance company.

For practical purposes, proving DV means getting a diminished value report. You can buy one on line (I'm not sure how that works) or you can hire an appraiser (DV expert) to physically inspect your car to look for repair related and insurance related DV and also do market research to establish inherent DV. This is not cheap. It is also money out of your pocket. Theoretically you can recover for the cost of getting your DV report, but unless you actually recover, this may not be a good investment.

After I get the DV report (which will happen after repairs are made), then I will face the second part of the problem which is recovering the DV. Will this be worth the trouble? We'll see.

I'd like to hear anyone's opinions, particularly if you have experience with diminished value claims.

If there is interest, I will follow up.

Hope to be back on the road (without pistons) soon!

ZZZ

 

I was rear ended last year by a driver without insurance. My insurer (Geico) paid for both the repairs as well as another $2500 in a DV claim. I checked with a couple of local body shops (Houston) and got the name of a man who specializes in DV claims. He charged me $250 to document the claim including pictures which I filed with my carrier. Overall a very good return on investment!

Good luck.

 

You have to prove that your car lost value as a result of the loss and you cannot try to recover more than the cost of repairs. Some ppl think they are entitled to $10,000 when it only cost $2000 to repair their car from the loss. Not calling you an idiot but I get idiots thinking this all the time. Most of it usually comes from dealerships telling them their car would never run right or they tell ppl that the shop did an improper repair but cannot show anyone what was repaired improperly. Sorry about the rant as this is a sore subject for me cause I deal with this stuff all the time. If you pay any independant appraisal service they will come up with some kinda $$ figure cause you paid them to do so....even if there is nothing wrong with you car. Don't be surprised if the other guys company wants to look at your car also...they're not just going to shell out addt'l money cause some guy you paid said your car is worth $2000 less than it was before the loss.

 

But even if the repair is good, and the car is perfectly OK, a Carfax report will be a Mark of Cain.

The local Fox TV station did a consumer report on how people get stuck with "rebuilt wrecks". The "rebuilt wreck" they zeroed in on was a car that had been in a fender bender, and properly repaired. Not a salvaged total or anything like that. It just had an accident listed on its Carfax.

The information age and multiple Big Brothers has brought much with it.

Ken

 

I thought that was the whole point of diminished value, that even beyond the cost of repairs, the car has suffered a loss of market value. The market perception of the "repaired wreck" even if the repair is perfect, as the poster above said.

I agree that DV will be hard to prove, and that the exact amount of lost value is subject to debate -- but are you saying that diminished value is not recoverable at all? Or are ranting about people who exaggerate their claim or try to say there was a bad repair job there wasn't?

Could you say what you deal with all the time so I know what I am in for.

I may not be entitled to much DV on a $2000 repair job (unless the repair was not done well) but I think there would be substantial DV on a late model car with an autofax report showing significant past damage (say $10,000 or more).

ZZZ