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What is a Diminished Value Appraisal?

When a car accident occurs, insurance companies will often pay to repair the immediate damages; However, diminished value comes into play when trying to RESELL a car that has been in a collision! If you try to sell your car after a crash, you’ll probably discover that it’s not worth as much as it was before.

Diminished value description before and after accident
Example of Diminished Value after Car Accident

Once your vehicle has been wrecked and repaired, it has probably lost value! This loss in value is called Diminished Value. It is the difference between what a car is worth before and after an accident.

Value is determined by what a buyer is willing to pay. In the past it was difficult for a buyer to know if a vehicle was in an accident, but this is changing due to Carfax® and Autocheck® vehicle history reports becoming popular.

If given the choice between two identical used cars, except for the fact that one had significant repairs, most buyers would choose the car that was accident-free. In most cases both buyer and seller will negotiate a lower cost because the buyer perceives the car to be less valuable. Even if the repairs were top notch, you will likely receive less money for your vehicle whether you sell it the day after repairs or years later.

The Secret Insurance Companies Don’t Want You to Know

You are not alone if you’re not familiar with the concept of diminished value as most people have never heard of this or don’t think to pursue it. If you’ve ever been in a motor vehicle accident you probably found that the insurance adjuster will do whatever they can to limit the amount they have to pay out. Insurance adjusters do not address the vehicle’s decrease in value until the claimant brings it up and if you do, be prepared for a fight!  They will provide all sorts of objections against paying your claim. If you don’t know the facts or have the appraisal necessary to pursue the loss, most adjusters will succeed in not paying what your claim is worth.  Our site was designed to teach you more than what most adjusters know.

If you were not at fault for your vehicle’s damage, then you should be able to recover lost value from the party at fault or their insurance company. You are entitled to be made whole. If they only repair the car, then you are not made whole!   In 2010 Louisiana Revised Statute §9:2800.17 was enacted that specifically addresses liability for the diminution in the value of a damaged vehicle. YOU MUST PROVE YOUR CLAIM!

The LADOTD Traffic Safety Office reports there were 38,594 accidents in Louisiana in 2017. Of those, 27,525 were for property damage only. Of those property damage claims, the vast majority only had their vehicle fixed. The insurance companies have done an excellent job of keeping this a mystery because only a very small percentage pursue claims for dimunition in value.

Steps in Pursuing a Diminished Value Claim:

Step One – Determine Feasibility:

First we’ll need you to send a copy of your repair estimate.  You can fax or email a copy or use our assignment form. From that we will order a Carfax, review it, and then contact you after doing a feasibility analysis to determine if your case is worth pursuing. This is all FREE! Because different factors affect diminished value and your chance of recovery, we first review what’s on the vehicle history, the year make and model, any liability concerns and what insurance company you are filing against.  We will then follow up with you to discuss the feasibility of your diminished value claim.

Step Two– Determine Accurate Amount with Diminished Value Appraisal:

If your claim seems feasible then the next step is to proceed with an appraisal. Insurance companies are skilled at paying as little as possible and will offer significantly less than what your claim is worth. They may use unfair formulas to determine the amount of your claim. The most accurate and fair way to determine how much your vehicle decreased in value is to actually gather data from multiple used car sales managers in the local market. We know all the dealers and keep a database of who will cooperate and who will not. Don’t accept an insurance company formula. The Bureau of Certified Auto Appraisers indicates that, “Using a formula only to determine the post repair value of a vehicle is not acceptable under any USPAP or BOCAA guidelines.” Our detailed and professionally formatted DVM diminished value evaluation report uses nationally recognized standards to assess the decrease in value, and can be submitted to the at-fault party for payment.

Step Three – File and Pursue Claim with Insurance Company:

The last step is to submit a demand to the insurance company.  We provide you with a sample demand letter that you can edit and submit to the insurance company. Most adjusters will pay the claim once they receive a legitimate appraisal, however some will attempt to negotiate with you. We’ve heard every excuse and seen every tactic, and can assist with additional information to help negotiate your claim. Unfortunately some companies can be very difficult to deal with, which is why all three steps are so important in successfully pursuing a claim.  Ultimately it is sometimes necessary to seek legal assistance, but you should be well prepared if this becomes needed.

We provide diminished value appraisals in New Orleans , Baton Rouge, Lafayette, Lake Charles, and all over the State of Louisiana. Please feel free to download our free book  “The Secret of Diminished Value in Louisiana” to learn all you need to know about pursuing a diminished value claim in our state.

The following news report will help you to learn more:


Learn more about diminished  value on our blog page. Here are a few recent articles below:

Permanent link to this article: https://www.diminishedvaluemethod.com/

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sample demand letter for diminished value

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