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Advice on How to Recover Damages for Diminished Value or Diminution of Value of a Repaired Car or Truck

What is a Damaged Vehicle Worth Post Repair?

The Law of diminution of value:

The unspoken money owed post repair

by lemonprotection

If you found two similar cars for sale at the same price, but one had an accident with $10,000 in repairs performed and the other was never in any accident, which car would you buy?

Put another way, if your new car sustained $10,000 in damages in an accident, even if it looks great after its repaired, isn't it still worth less post repair than it was right before the collision?

So the question is, can you get money for this loss in post repair value of your damaged car, truck or other vehicle? Fortunately, the answer is YES. You can get Diminished Value or Diminution In Value of your car, truck or other vehicle post repair if you are willing to fight for it!

When a car or other vehicle has been in an accident and then repaired, its value post repair is less than the value of a similar car or other vehicle of the same year, make and model with no repair damage history. In fact, many new car dealerships which take in trades (i.e., give you a credit for the value of your current car when you buy a new car from it) do not re-sell any such car or other vehicle if it has an accident history. They will take accident damaged vehicles in trade, but not only will pay you less for it because of its diminished value due to it being involved in an accident, but then will not try to sell it to the public. They often will auction such vehicles off.

To start, what exactly is “Diminished Value” or sometimes called “Diminution In Value” for a car, truck or other vehicle?

It is a loss in value of the car, truck or other vehicle, or, for that matter, any property, due to a sudden and unexpected accident. In other words, even after a damaged vehicle or other property is optimally repaired, it obviously has lost some value because of its damage history. The value of a damaged car or other vehicle is clearly diminished post accident as a buyer would pay more for the same vehicle if it was never damaged in an accident or, put another way, a buyer given the choice of two identical cars but one had been in a major collision obviously would prefer to buy the never damaged vehicle and would expect to pay much less for the previously damaged then repaired vehicle. In other words, it is the money you will lose post accident when you eventually sell or trade-in your repaired-vehicle; and it is the additional money owed to you by the responsible party or the Insurance Company for the responsible party that caused the damage to your car, truck or other vehicle.

A Personal Story

I received a call from an attorney in Las Vegas about a vehicle that had been in an accident and repaired. The attorney contacted the Insurance Co. and asked for the Diminished Value of the vehicle due to this collision damage. The insurer offered him $1,000 and that was it. After months of back and forth negotiations trying to get the insurer to make a fair settlement offer with no success, the attorney heard about my business through another attorney I worked with over the years. The attorney called me and asked if I could write a solid Diminished Value report on the vehicle for the client he is representing. I replied I would need to review the file but from the information initially provided believe I could help.

I took all his information, including the repair estimates for this vehicle, and wrote a Diminished Value report and it showed the amount owed was far more than $1,000. In fact, it was over $6,400. I sent the attorney my report. A week later the attorney called me to let me know that the Insurance Co. will not recognize my report, so he wisely requested that the Insurance Company adjuster write its own report.

I later was shown the Diminished Value report written by the Insurance Co. adjuster. It was not accurate, it was one sided and did not include all the repair costs.

I then contacted the attorney and explained the errors and omissions with the insurer’s report and pointed out the lack of foundation and told him the insurer’s report would not hold-up in court. The attorney agreed. This was something I was able to help with that others might not have noticed because of my many years of experience in the motor vehicle industry.

The attorney contacted the Insurance Co., spoke to the same adjuster and made it clear he was rejecting the insurer’s meritless position and preparing for trial on this matter. The adjuster’s bluff failed and to avoid litigation the adjuster settled for a compromise amount $4,653.00. This amount was more than four and a half times what the Insurance Co. had previously offered, and was a fair compromise amount to settle for to avoid a time consuming trial. Just by getting the right diminished value report with a good solid foundation made this happen for the attorney’s client.

Law on Diminished Value

Keep in mind, the law (see comment at end of this article)* in most states provides that you are entitled to Diminished Value when you are not at fault because you are entitled to be compensated for all foreseeable damages caused by the negligence of another person. It clearly is foreseeable that a damaged car will be worth less post repairs than it was worth right before the collision.

You should be able to collect Diminished Value if:

  1. The collision was not your fault and the responsible party has insurance as recovery for diminished value is often only permitted against the other party and his/her insurer (often referred to a “third party claim”) and usually is not permitted under your own insurance collision coverage (often referred to as a “first party claim”). The reason for this is that your recovery against the responsible party is based upon all damages that are foreseeable, while your recovery from your own insurer is based upon the written terms of your written policy of insurance. Your written insurance policy is actually a contract and subject to contract law. Your own first party collision insurance coverage as described in your own policy of insurance probably will not cover this type of loss and you would be bound by this written provision under principles of contract law unless there is a specific law in your jurisdiction negating such insurance coverage provisions. In California there presently is no such law. If you have a potential claim and it’s against your own insurer, then you should get a full copy of your insurance policy and read what it states about this. If it not clear to you, then you should provide your full insurance policy to your lawyer to review and advise you.
  2. The party at fault has insurance or sufficient funds to pay your damages.
  3. Your vehicle is not older than ten (10) years.
  4. The damage estimate was at least $2,000.00 (as the damage needs to be more than minor) and/or there is frame damage to your car, truck or other vehicle.
  5. Your vehicle was repaired and not deemed a total loss (as if it is a total loss then you should be compensated for the full value of your vehicle with any total loss settlement).
  6. You have not entered into a settlement and released the other party and his/her insurer for all property damage claims.
How to get the Diminished Value for Your Repaired Car or Other Vehicle

Here is how you can get your Diminished Value recovery or payment post repair of your damaged car, truck or other vehicle.

First, get the vehicle’s entire file, including the purchase contract, and all repair estimates, including the adjuster’s first estimate called the pre-takedown and the supplemental estimate after takedown, if any. Both reports taken together should describe the damages that were caused in the collision and the full amount or cost to repair.

After reviewing all the papers, I would also do an inspection of the car or other vehicle with photos, if the vehicle has not been repaired and is available for inspection, and do research to support and back-up my findings. Then I review everything and prepare a detailed written report setting forth my findings and the financial or money loss for the Diminished Value of the subject car or other vehicle.

I use a special formula designed by a master mathematician that has been accepted in trials by six (6) Court Judges. The formula encompasses several different areas of research and then all the numbers are compiled into the formula that gives a solid foundation for Diminished Value.

The formula consists of the following:

  1. Using the Insurance appraiser’s primary and secondary estimate of repairs;
  2. Researching AutoTrader for the current value of several like vehicles of the same make, model, year and near mileage;
  3. Using Black Book, Kelly Blue Book and Edmonds for price comparisons; and
  4. Then applying the numbers from the above information to the formula in order to attain the true Diminished Value caused by the collision.
Here is One Thing You Should Remember Not to do to Help Collect Diminished Value

Do NOT sign any Settlement Releases or papers until you show them to me and/or your lawyer. You must be careful not to sign away your rights until you have been fully and fairly compensated for all damages.

If you have all your papers together and have not signed off on your settlement or signed a Full Release and meet the criteria set forth above then I probably can help you. I am always happy to take your call to discuss if I can help you and there is NO charge to do this. I am happy to provide a free consultation.

After the Repair Estimate is Made
  1. Make sure you let your Insurance agent and adjuster know when you speak to them that you will be seeking money for Diminished Value from the other party.
  2. Get copies of all repair estimates, including both the 1st body shop estimate and then the 2nd estimate called a supplemental estimate.
  3. Get a copy of the police report (aka traffic collision report), if one exists. Your insurance company and/or personal injury lawyer, if you were injured, should be able to help you do this.
  4. Get an experienced vehicle appraiser who knows how to write Diminished Value reports. You may contact me for a free consultation at or call me toll free at 1-800-700-0109.
  5. The appraiser may need to see your vehicle more than one time for photos. Don’t get disturbed or depressed it this is necessary. Sometimes, for example, the photos we take are not as clear or complete as we want them or new issues come-up so, at times, we need to retake photos or re-inspect the vehicle.
  6. Do not sign a release or any settlement papers if the Diminished Value has not been discussed and resolved. If you have to sign-off on the car to get it from the shop and cannot wait then above where you sign simply write in the following: “Diminished Value Expressly Reserved, Not Settled.” This may help protect your rights.

After the appraiser has examined and photographed your vehicle, the appraiser will start to write the Diminished Value report. This report will include several things in it that will help prove your loss and damages. Be patient because sometimes it takes a few days or even weeks to obtain needed supporting information, to complete needed research and prepare a detailed Diminished Value report.

What not to say or Agree With

Now here are some things you must be careful with that I advise all my customers to follow. I call it, “What not to say when attempting to settle your Diminished Value claim.”

After the insurance adjuster gets your report and demand letter for payment, you may get a call from one of its attorneys or adjusters (for simplicity, I shall refer to anyone from or working with the insurer as an adjuster) and you must be very careful in how you talk with them. Errors regarding what you say (and what not to say) can lessen or diminish the amount you may be able to collect or sometimes even cause you to lose the possibility to collect anything from them. For this and other reasons, some clients wisely prefer to hire an attorney or let their personal injury attorney handle this for them.

For example, using the words “Condition” or “Value” the wrong way can hurt you. You must keep the focus on “Diminished Value” and/or “Diminution in Value”. Remember, based upon this scenario, including that the repair shop did a good job in repairing your damaged car, truck or other vehicle, your claim is not against the repair shop for the repairs, but it is against the other party and his/her insurer for the resulting inherent loss of value post repair caused by the collision damages.

You must stay focused on you claim for “Diminished Value”. You should tell the adjuster repeatedly you have no issues or complaints with the quality of repairs since, as far as you know, the repairs were done to the best of human ability. However, it is also critical to never say anything like “the repair was perfect.” It is impossible to know what additional damage is hidden under the repairs made.

Be very careful when talking to the insurance adjuster as he/she may use the word “condition” when you want to talk about “Value”. The insurance adjuster may say something like the condition is just like it was before and if you agree you just lost because the adjuster can say things like this: “Well your complaint then is not with us it is with the body shop.” The adjuster may try to say that all the damaged parts were fixed; the vehicle is restored to the same pre-accident condition as before the accident. The adjuster may say goodbye and hang-up on you. Remember, your Diminished Value claim isn’t trying to recover a loss in condition; it is to recover the loss of value caused by the collision that repairs alone, no matter how good, cannot resolve.

Some clients prefer not to negotiate with the insurance adjuster and to have an experienced personal injury and property damage lawyer handle that. That is not a bad idea and from past experience we recommend you contact the Law Offices of Gary K. Walch, A Law Corporation. It provides free & confidential consultations and claim evaluations. Its telephone number is 818-222-3400, email is and web site is

What Else You Should do

You need to know the facts. You need to do some basic research or have me do it for you. I am happy to do that! It is part of the expert appraisal service that I can provide for you at a surprisingly low cost. You need to be armed or here is when you lose money. I also advise that you should obtain both a CarFax and CarCheck report on your vehicle. If you do not know how to do that, just give me a call or send me an email.

When you see the CarFax or CarCheck research report you will know if your vehicle was in an accident and you will have to disclose the accident and repairs made when you sell your car. The loss of value is in many cases between 40 to 60 percent, money you will not get when you sell or trade it in. In fact, some new car dealers will not take a vehicle in trade if it shows to have been in an accident no matter who did the repair work. This is something that can be both very surprising and upsetting later on so its clearly best that you be prepared for it all now.

If you get a clean CarFax be sure also to get a CarCheck as well, because sometimes an accident may not be reported to both places and you may be surprised in what you find.

If in a Car or Other Motor Vehicle Accident, Please do the Following, if Possible

Here are some steps you should take if you are involved in a car, truck or other vehicle accident so be prepared if this happens to you:

  1. Check to see if there is any fire or if anyone is hurt; if so, then immediately call 911.
  2. If the accident is not your fault, you are also advised to report it to the police to obtain a traffic collision report supporting your position.
  3. Exchange information: First get the person at fault driver’s license number, address, phone numbers, email address, vehicle license plate number and insurance information. Be sure to personally read the driver’s license yourself and copy down the information or take a photo of it; do NOT rely upon someone else, like the responsible party, to say the number and other information to you as it may turn out to be incorrect. Remember, most mobile phones have a camera, so why not use it to take a photo of the driver’s license.
  4. Take notes: Be detailed about what happened, including which lane you were in and the position of each vehicle from about thirty (30) seconds before impact until after the impact, what you were doing and what was going on around you, the exact time of day, sunlight conditions, street lighting and weather conditions, including whether it was wet or dry, etc.
  5. Take photos and video before the vehicles are moved, if possible, from several angels, positions and distances, but, of course, be very careful. Do not get into traffic or do anything unsafe to take pictures. Remember, most mobile phones are equipped with cameras and video capability.
  6. Get the name and contact information (e.g., phone numbers and email addresses) of all witnesses, if any; and ask what each saw. If there are any favorable witnesses, do your best to get their contact information and to convince them to wait until the police arrive so they also can give their statements directly to the investigating police officers.
  7. Try to recall if the other driver was on the phone or texting. If so, document that information with the exact time and inform the investigating police officers and your own insurance adjuster and your own personal injury attorney (if you were injured and retained an attorney). If you were injured and do not have a personal injury attorney, one excellent and very experienced personal injury law firm we have worked with which offers FREE & CONFIDENTIAL consultations on accident injury claims that you may contact is The Law Offices of Gary K. Walch, A Law Corporation. Its telephone number is 818-222-3400, email is and web site is
  8. You can call your own tow truck. You do NOT have to use the one that might arrive at the scene and, if appropriate, you may have your car or other vehicle towed to a repair shop you know, your home or other location of your own choosing to avoid storage costs. If you contact a personal injury lawyer or your insurer’s claim’s department while at the scene of the accident, your attorney or insurer also may be able to assist you with tow and other issues.
  9. The Insurance adjuster(s) will come to wherever your vehicle is located or stored post accident to do the first estimate and a supplemental estimate will be added later if the vehicle appears to be repairable and the cost of repair is less than about 80% maximum value of your vehicle. If it is higher, the insurer may deem it a total loss.

If you have any questions about any of this, please call me or send me an email.

Good Luck and let me know if I can help you.

Thank you and GOD bless you.

Lemon Protection

Telephone: 800-700-0109

*Courts have held that where a damaged auto was repaired to “its pre-accident safe, mechanical, and cosmetic condition,” an insurer’s obligation to repair to “like kind and quality” was discharged according to the insurance policy. However, recovery for tort damages includes the difference between the fair market value of the object before the loss and its value after the loss. Ray v. Farmers Ins. Exch., 200 Cal. App.3d 1411 (Cal. App. Dist. 3, 1988); Moran v. California Dep’t of Motor Vehicles, 139 Cal. App.4th 688 (Cal. App. Dist. 4, 2006).

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