Diminished Value Claims in New York
If your vehicle has been repaired following an accident in New York, its resale value might be less than its pre-accident worth, even if the repairs were top-notch. This decrease in value is referred to as a Diminished Value Claim.
If someone else was responsible for the damage to your vehicle, you may be able to seek diminished value compensation when filing a property damage claim.
In most car accident claims, the majority of compensation sought is for medical expenses incurred due to personal injuries suffered in the crash. New York requires motorists to file initial claims for coverage of injuries against their own Personal Injury Protection policies. But Personal Injury Protection policies do not cover vehicle damage.
You would file a claim against the at-fault driver’s auto liability insurance for coverage of damage to your vehicle. As part of the property damage claim, you also may seek compensation for the diminished value of your vehicle. Depending on the type of vehicle and damage, the diminished value could amount to several thousand dollars.
If you have been in a car accident in Queens that someone else caused, resulting in extensive repairable damage to your vehicle, the Tadchiev Law Firm can help you evaluate your options for pursuing a diminished value claim in addition to seeking compensation for other expenses and losses. For a free, no-obligation discussion of the losses you have suffered in a car accident, contact us today.
How We Can Help You to File a Diminished Value Claim in New York
At The Tadchiev Law Firm, P.C., our attorneys are committed to helping people who have been physically, mentally, and financially injured in car accidents in Queens, NY. We know how to handle insurance companies and will work to maximize the compensation available to you. When handling your personal injury claim, we also can assist you with the insurance company paperwork and court filings required to pursue a diminished value claim.
Once we can demonstrate the other driver’s legal responsibility for the accident, we will begin to calculate what you are owed, including compensation for your wrecked-and-repaired vehicle’s diminished value.
Instead of relying on formulas, we will determine your vehicle’s actual cash value prior to the accident and negotiate for the compensation you deserve
We can refer you to obtain an independent, unbiased appraisal of your vehicle to determine and document its value in the Queens area. This would take into account your car’s NADA and/or Blue Book value plus data about sales of vehicles similar to yours in the borough or greater NYC.
We would make sure the appraisal of your vehicle considers any custom paint, upgraded after-market parts, or other factors that make it worth more prior to the accident.
Our attorneys can determine the amount you deserve for diminished value damages after a car accident. We can send a demand letter to the at-fault party’s insurance carrier explaining your loss along with the evidence supporting the value of your claim. The insurance company may choose to pay the claim in full, deny the claim, or in most cases, make a lower settlement offer.
Most car accident claims can be settled through negotiations. Whether to accept a settlement offer is always the client’s decision.
What Is Diminished Value After a Car Accident?
The diminished value of a motor vehicle is the difference in its market price before and after it has been wrecked and repaired. A vehicle is worth less money after an accident. Even a car restored to its original condition with original equipment manufacturer (OEM) parts will have a lower resale value.
In most cases, it will be more difficult to sell a car that has had extensive repairs, and you will get less money for it. The availability of vehicle history reports makes it easy for prospective buyers to find out that a car has been crashed and repaired. Car dealerships may even decline repaired vehicles as trade-ins or offer substantially less for them.
Types of Diminished Value
A vehicle’s diminished value may be classified as one of three types:
- Immediate diminished value refers to the vehicle’s value immediately after the accident and before repairs.
- Inherent diminished value is the value a vehicle loses due to its history of damage. Inherent diminished value assumes that the vehicle’s repairs were of optimal quality.
- Repair-related diminished value is a loss of value based on low-quality repairs to accident damage. For example, using aftermarket parts instead of original manufacturer parts or low-quality, nonmatching paint that leads to a loss in value.
How Diminished Value Claims Work in New York
Multiple NY court opinions recognize that a plaintiff (the injured party) in an accident claim deserves to be made financially whole, including the costs of diminished value.
In Rosenfield v. Choberka, 140 Misc. 2d 9, 14 (N.Y. Sup. Ct. 1988), for example, the Court said:
(A)mong the “well-settled” rules relating to damages recoverable in tort actions is that “[t]he person responsible for the injury must respond for all damages resulting directly from and as a natural consequence of the wrongful act according to common experience and in the usual course of events” (Steitz v Gifford, 280 N.Y. 15, 20). Application of those basic principles to the facts before us permits only the conclusion that where, as here, the repair of the plaintiff’s car does not make her whole, she is entitled to an award that will do so. In this instance, that entitlement is to the reasonable cost for repairing the physical damage to the plaintiff’s automobile together with the difference in its market value before the accident and after it is repaired.
In that case, the court increased an earlier award of more than $7,000 for repairs to the plaintiff’s vehicle by $2,000 for the inherent diminished value of its market value.
How Do I Calculate Diminished Value?
Most insurance companies calculate the diminished value in a car accident by using a formula that originated in a 2001 Georgia case involving State Farm auto insurance. It is known as the 17c Diminished Value Formula.
Using the 17c Diminished Value Formula, you would:
1. Determine the pre-accident value of your car by referring to the Kelley Blue Book or the National Association of Auto Dealers (NADA).
2. Calculate 10% of the NADA or Blue Book value. This is the maximum an insurance company is likely to pay on the claim.
3. Apply a damage multiplier. Multiply your 10% “base loss value” by a number corresponding to its damage from the accident:
- 0.25 – minor damage
- 0.50 – moderate damage
- 0.75 – major damage
- 1.00 – severe structural damage
4. Apply a mileage multiplier. Multiply the figure obtained in Step 3, known as the damage-adjusted diminished value, by a figure corresponding to the car’s mileage:
- 0.2: 80,000-99.999 miles
- 0.4: 60,000-79,999 miles
- 0.6: 40,000-59,999 miles
- 0.8: 20,000-39,999 miles
- 1.0: 0-19,999 miles
You’d use zero, resulting in no payout, if your vehicle had 100,000 miles or more.
If your car’s Blue Book or NADA value is $20,000, the most that an insurer is likely to pay is $2,000 (10% of its pre-crash value). If the vehicle had moderate damage, cut that payout to $1,000 (x 0.5). If your car had 62,000 miles on it (x 0.4), the final diminished value is calculated as $400.
As you can see, it is a somewhat complicated formula. There are numerous 17c Diminished Value Formula calculators online.
Get in Touch with a Queens Diminished Value Claim Lawyer
If your car has lost value because of an accident in New York that someone else caused, you may have a right to be compensated for this loss. You should have a Queens car accident lawyer review the details of your accident and help you ensure that your losses are properly evaluated and recovered.
At the Tadchiev Law Firm, we serve as advocates for car accident victims in Queens. We don’t charge fees unless we recover compensation for you. We offer a free case review to answer any questions you may have. For your free case review, call us today or reach out online.