What Is Diminished Value & Do I Deserve It?
Diminished Value (DV) is one of those phrases you often hear thrown around in legal and insurance offices, but that is confusing to many. Let’s discuss what it is in simple terms and why that may matter to you.
When you are involved in a motor vehicle accident through no fault of your own, there are two types of cases: (1) Property Damage (involving your vehicle); and (2) Bodily Injury (your medical treatment and care). The Property Damage (“PD”) portion of your case involves only the totaling or repairing of your vehicle. The Bodily Injury (“BI”) portion of your claim is much more complex. You can find more on a BI claim here.
If your vehicle is seriously damaged but not totaled, you may find yourself in a situation where your vehicle is fixed but loses value overall. Of course, you will not be able to determine the exact amount of value you have lost until you actually sell your vehicle. The value you have lost is considered Diminished Value (“DV”).
More precisely, DV occurs when a vehicle has been involved in an accident and is repaired. The loss in value to your vehicle is the difference between what a reasonable person would pay for your vehicle if it had never been involved in an accident and what that same person would pay for the vehicle after the accident and repairs. Another way to think of diminished value is under this scenario: you are given the ability to purchase one of two vehicles. They are identical, except one vehicle has been in an accident and the other has not. Most people would expect to less for the vehicle that had previous damage. This difference is referred to as diminished value.
The good news is that Arizona allows compensation for the diminished value to your vehicle after the accident and subsequent repairs. The problem is that proving the loss in value is sometimes difficult. Some insurance companies would have you believe that you must sell your vehicle in order to prove the diminished value to your vehicle. A recent Arizona case states otherwise. In Oliver v. Henry, 227 Ariz. 514 (2011), the court of appeals stated “We conclude that Arizona law does not require the sale or transfer of a damaged vehicle to establish a claim for diminution in value or to prove the amount of the loss in value. (id. at 519). In fact, it is possible to prove the loss through the use of an expert appraisal.
Keep in mind that not all vehicles are eligible for diminished value claims. In fact, a good rule of thumb is that if your vehicle is two (2) years old or older, you will probably not be able to recover DV. Additionally, you only have two years in which to bring a case for the diminished value of your vehicle. We are here to help you navigate through the obstacles of making a claim for DV to your vehicle after an accident, as well as help you with your personal injury case.
If you have any questions about your personal injury case, it is recommended to consult with your local personal injury attorney.
