Cars are expensive investments for the majority of the population. Even purchasing used cars can cost thousands of dollars and put a significant dent in your bank account.
Since you have spent so much money on your ability to get from place to place, you likely care about the value of your car, especially if you ever hope to trade it in or resell it yourself.
Many factors will determine the resale value of your car once it has been purchased. They include mileage, maintenance history, open recalls, model, manufacturer, the year it was made, whether it was a new car or used, and even the color of the car. Resources like Kelley Blue Book help many car owners determine what their vehicle is worth based on these factors.
Another factor that is deeply concerning is car accidents. In almost every circumstance, a car accident devalues the vehicle by recording its accident history. There is an inherent diminished value that is largely dependent on the car’s age that cannot be fixed, but this effect is compounded after a car crash.
This leaves many owners frustrated, especially if they have been in an accident that was not their fault. From that moment on, the vehicle history reports will show that it received structural damage in the past and the market price will drop.
Typically, the existence of an accident in a vehicle’s history will make the car depreciate by $500. This is an average based on various types of accidents across the country, and may not take into account make or model. However, if there were significant vehicle repairs that became necessary, that cost could be around $2,000.
Even if the car is completely fixed after the accident, vehicles lose market value due to the collision being recorded in its damage history.
So how much does a car depreciate in market value after an accident? It depends on the severity of the collision. If there was minor damage, the drop will likely be just a few hundred dollars. For severe damage, you are probably looking at a diminished value that is thousands of dollars less than before the accident.
Fortunately, there is a potential solution that could help you recoup the car’s diminished value if the accident was not your fault.
A diminished value claim is an action step that you can take when you are not the at-fault driver in a car accident. After a serious crash, the last thing you want to see is the car’s value drop, even if full repairs can be made and it is restored to its pre-accident state. Potential buyers will still see the mark on its accident history and want to pay less for the vehicle.
When you file a diminished value claim, it is because you intend to seek damages that will be paid by the at-fault driver’s insurer. Their insurance company will have to give you compensation for the repair-related diminished value.
A diminished value claim can take place in addition to regular insurance claims. Insurance companies may end up paying for your vehicle to be fully repaired, and then on top of that, they could pay out the losses you have accrued because of the diminished value of the vehicle.
Filing diminished value claims is not easy to do. Several factors will determine whether or not your claim will be successful.
The biggest obstacle to winning fair compensation and covering the losses after a car accident is proving that the driver of the other vehicle caused the collision. You need solid proof to back up your claim. For example, a police report that substantiates your innocence would improve your chances of recouping the lost value of your vehicle.
Insurance companies hate to make payouts. No matter how far the value of your vehicle has plummeted after the accident, the insurance company of the other driver will try to minimize how much money you will receive to cover the reduction in resale value.
A good car accident attorney knows how to negotiate with an insurer to get you the compensation you deserve is crucial to your car’s value claim. They can help you recoup the full amount that the value dropped after vehicle repairs were made.