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Diminished value claims: getting paid for your car’s lost value
Even after good repairs, a car with an accident history can sell for less. A diminished value claim seeks payment for that lost resale value. Whether you can recover it, and from whom, depends on who caused the crash, your policy and your state’s law.
By SettlementLift. Published · Updated .
What diminished value means
Inherent diminished value is the drop in market value caused by the accident history itself, even after proper repairs. Repair-related diminished value comes from poor or incomplete repairs. Most claims are about inherent diminished value.
Third-party claims
When another driver caused the crash, you can generally seek diminished value from that driver’s liability insurer as part of your property-damage claim. This is available in most states, though the amount is often disputed.
Claims against your own insurer
Most auto policies do not pay diminished value on your own collision claim, and courts in many states have enforced that. Georgia is a notable exception, where the state Supreme Court held in State Farm v. Mabry (2001) that policyholders can recover it. Florida’s Supreme Court reached the opposite result in Siegle v. Progressive (2002), and Texas did in American Manufacturers Mutual v. Schaefer (2003).
Texas Department of Insurance: Auto insurance guide ↗How insurers calculate it
Many insurers use a version of the 17c formula, which starts at 10% of the car’s pre-accident value and reduces it for damage severity and mileage. The result may differ from the loss shown by market evidence. Our calculator explains the formula step by step and its limitations.
Building your claim
Gather the repair invoice and photos, the pre-accident value from a recognized pricing guide, the vehicle history report, and comparable listings or dealer offers for similar cars with and without an accident. An independent appraisal from a qualified appraiser is often the strongest single document.
Deadlines
Property-damage claims have filing deadlines set by state law, and they differ. Georgia allows four years for damage to personal property. Florida shortened its general negligence period to two years for claims arising after March 24, 2023. Confirm the deadline that applies before negotiations stall.
When an attorney helps
Attorneys rarely take a diminished value claim on its own, but it is often handled alongside an injury claim from the same crash. If anyone was hurt, raise the vehicle’s lost value in the same consultation.
ABA: Questions to ask a lawyer ↗Frequently asked questions
Can I claim diminished value if I was not at fault?
Generally yes, as part of your property-damage claim against the at-fault driver’s insurer. The amount is often disputed, so evidence matters.
Will my own insurer pay diminished value?
Usually not. Most policies and courts exclude it on first-party claims. Georgia is a notable exception.
What about a leased car?
The leasing company usually owns the vehicle, so it may hold the diminished value claim. Check your lease and ask the leasing company.