Virginia Code §46.2-1600 defines diminished value compensation “as the amount of compensation that an insurance company pays to a third party vehicle owner, in addition to the cost of repairs, for the reduced value of the vehicle due to damage.”
Essentially, the insurance company must pay you the difference between the pre-accident value of the vehicle and the post-accident value of the vehicle.
How Do You Make a Diminished Value Claim in Virginia?
First, you must notify the insurance company of your desire to make the claim. The insurance company will not go out of its way to inform you. You have to ask.
Once you notify the insurance company that you wish to make a diminished value claim in addition to your property damage claim, the company will determine the loss in value. If you have a late model car of little value that was involved in a minor impact, your diminished value may be minimal. However, if your vehicle has high value and/or was involved in a serious accident with considerable property damage, your diminished value claim could be substantial.
The insurance company will then likely make you an offer. If you consider the offer fair, you can settle the claim in exchange for the money. However, what if you are unhappy with the offer?
First, I always tell people to ask the insurance company what rights they have under the insurance policy. The policy may contain provisions which upon request allow for an outside appraiser to determine the post-accident value of the vehicle. Even if no such provision exists, you can always hire your own independent appraiser to determine the value of your vehicle, which you can submit to the insurance company in support of your claim. You will, however, have to make a judgment call if that is a worthwhile investment. The insurance company may reject your appraiser’s findings, and force you to go to court to sue for diminished value based upon the higher appraisal.
You will have to make a decision. Often, the cost of the appraiser does not make economic sense for you if you accident was minor, or your vehicle has relatively little value. However, if your vehicle has considerable value, or because of its unique nature is hard to value, your claim could be sizeable enough to warrant hiring an expert appraiser and/or litigating to get fair payment for the diminished value of your property.
If you have been injured in an auto accident in Virginia or northeastern North Carolina, our accident injury lawyers can help you with all aspect of the case.