You can find the answer to the question, “Can I make a diminished-value claim?” on the internet. This question has a universal answer. Many people respond to this question with a “no” answer because they don’t understand the differences between third-party claims and first-party claims.
After a car accident, claims for diminished value are filed. This is a claim for the vehicle’s loss of value due to an accident. This is technically known as inherent loss of value. This type of claim can be made in almost all States and is possible to recover.
Why is it so confusing whether a claim for diminished value can be made? This is because the question and answer don’t specify who the claim is being made against or with diminished value.
In most states, a claim for diminished value against your insurance carrier will be denied. This is called a “first party claim”. It is unlikely that it will be denied because a majority States have made first-party claims for diminished value, either through legislative acts or court rulings. Your contract of insurance, the language and interpretation thereof, are the basis of a first party claim. That language has been interpreted by many courts as not allowing diminished-value claims. There is an alternative.
In nearly every state, the driver at fault can be sued for diminished value. This is known as a third-party claim and it is not based upon any insurance contract. It is based upon the law of negligence, damages. This claim is based upon the idea that the at-fault driver caused your vehicle’s loss of value through his or her negligence. He or she must pay you for this loss.
Answer to the question whether a diminished-value claim can be made against at fault drivers is “Yes” and not against your insurance company .
Another myth about diminished value is that your car’s value will not be affected if it was well repaired. This is a reference to diminished value due to repairs. This is a different claim that would be brought against the repair shop, not the person responsible for your accident. Even if the OEM parts were used and the repairs are perfect, your car’s value will be diminished because it was in an accident. It can be viewed this way: If you were shopping for a car, would you pay the exact same price for a car that was in an accident and has been repaired as for a car that is in good condition?
A few factors will help you answer the question “Can I make a diminished value claim?” The statute of limitations is the first. The statute of limitations determines the time limit within which you can file a claim for damages. Each state has its own statute of limitations. Maryland’s statute of limitations, for example, is three years. If the accident occurred on June 1, 2010, then one would need to file a diminished-value lawsuit or settle a diminished-value claim before June 1, 2013. They would forever be barred from making a diminished value claim if they didn’t.
A release is the second thing that will prevent you from making a claim for diminished value. A release is a legal document that prevents you from making further claims related to the accident. Be careful when you are asked to sign anything by an insurance company. This will affect your rights to future damages claims. Only sign a release if you are sure that all your damages have been covered.
