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A: The purpose of auto insurance is to "indemnify" the vehicle owner for loss. To indemnify means to "make whole" or to put you back in exactly the same position you were in just prior to the loss. The insurance company is required to restore your vehicle to its pre-accident condition with regard to appearance, safe operation and Value . The difference in a vehicle's value just prior to an accident and the same vehicles value just after repairs are completed can be very different. This difference in value is called Diminished Value. Most damaged vehicles will have lost values ranging from hundreds to thousands of dollars.
What is Diminished Value ?
Diminished Value is the amount by which the Resale Value of a damaged / repaired vehicle has been reduced for having sustained significant damage. There are two (2) generally accepted types of Diminished Value:
1. Inherent Diminished Value assumes optimal repair quality and is defined as the amount by which the resale value of a vehicle has been reduced simply because it has a significant damage history.
2. Repair Related Diminished Value includes any additional amounts by which the resale value may be reduced because of less-than-optimal repairs. This could include anything from cosmetic imperfections to major structural defects.
Has My Vehicle Suffered a Diminished Value ?
The only blanket answer here would have to be Yes ~ No ~ Maybe! The newer your vehicle in better pre-loss condition, with no previous collision history and the more severe the current collision damage . . . the more resounding the "YES"! The older the vehicle in poorer pre-loss condition, with a previous accident history and minor current damage . . . the more deafening the "NO"! As your circumstances moderate between these two extremes the more your true answer will fluctuate accordingly.
How Do I Know for Sure ?
Let the above "Yes ~ No ~ Maybe" answers serve as your guideline of probability. The more probable your vehicle has suffered a Diminished Value the more we recommend you have your vehicles Diminished Value assessed by a legitimate Diminished Value Professional.
How Do I Find a Legitimate Professional ?
This question actually has the potential for more problems than one might first imagine. Within the past couple years the "Pool" of Diminished Value "Appraisers" has mushroomed out of control. The insurance industry even seems to be underwriting some of these late entries in an effort to gain control of their Diminished Value "Problem". There are impostors out there that are more inclined to favor the insurance industry than work on behalf of consumers.
How Do I Collect Diminished Value ?
Regardless of what others may tell you, collecting Diminished Value from an insurance company can be a difficult and lengthy process. You should utilize the services of a professional Diminished Value claim specialist. The actual process will vary on a state-by-state and case-by-case basis. While the principle of Diminished Value has long since been recognized at law, the insurance industry has gone out of their way to not pay consumers for this legitimate damage. For years, the auto insurance industry has lied about owing for this damage and, more recently, has even enlisted the aid of Departments of Insurance in various states to keep from paying this damage to policyholders. These changing situations notwithstanding, there are still opportunities for you to collect full value for the Diminished Value of your repaired vehicle.
Who is eligible to collect Diminished Value?
If you were not at fault in the accident, the at-fault party (or their insurance company) owes you money. This is true in all 50 states. There is over 75 years of case law to back that up. If you live in the state of Georgia, you can also collect your diminished value from your own insurance company, whether you were at fault in the accident or not. This is based on a class action lawsuit in 2001 (Mabry v State Farm).
For more information on Diminished value please visit www.collisionclaims.com
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