How to Prove a Diminished Value Claim
If you’re unfortunate enough to be the victim of careless driving, the status of your vehicle may be the least of your immediate concerns. Getting treatment for your injuries and filing a police report are top priorities. However, if your automobile was damaged, you might qualify for a diminished value claim.
Not many New Mexico lawyers specialize in diminished value claims. Victims may not even be aware they need this kind of assistance until it’s too late.
What is a diminished value claim?
A diminished value claim can be filed any time your personal vehicle is damaged because of another driver’s negligence. Diminished value is the difference in your vehicle’s market value before and after an accident.
Most insurance companies in New Mexico use a calculation called the 17c Diminished Value Formula to calculate the diminished value of your vehicle. There are four steps in the process:
- Determine the value of your car using Kelley Blue Book or NADA Guides.
- Apply a 10 percent cap to that value.
- Apply a damage multiplier to adjust the value.
- Apply a mileage multiplier using your car’s current mileage.
Once you have completed all four steps, you’ll have the after-crash value of your vehicle. Insurance companies can do this for you, but you might want to check their figures or have your property damage attorney do so to ensure accuracy.
How does diminished value hurt my personal vehicle?
Not all automobile accidents result in your vehicle being totaled by the insurance company. Sometimes, the damage can be repaired. While it might seem like this is a good thing, it has little known repercussions for accident victims.
It doesn’t matter if the accident was someone else’s fault. Your personal vehicle sustained damage and no longer is in its original factory condition. That means when you go to sell it or trade it in for a newer vehicle, you’ll receive less money for it. This is called repair-related diminished value.
Victims of automobile accidents get a raw deal all the way around. They likely sustained injuries that can impact their future earnings and health. To add insult to injury, they also might be stuck with a vehicle that’s decreased in value.
What role does Carfax play in proving my claim?
When a vehicle accident is reported to your insurance company, they automatically notify Carfax. If you’re not familiar with Carfax, it’s a commercial web-based service that supplies vehicle history reports to businesses and individuals on used cars and light trucks in the U.S. and Canada.
If you’ve ever bought a used vehicle from a dealership, you’ve probably seen one of the comprehensive reports this service produces. All you need is a vehicle’s Vehicle Identification Number (VIN) or license plate number and state to request a Carfax report.
The reports aren’t free, so be prepared to cough up some cash if you want to check the impact of a crash on your vehicle’s market value.
To avoid a report being made to Carfax, the vehicle must be repaired out-of-pocket. If you’re concerned about diminished value, your property damage attorney can make this request of the at-fault party. Other negotiations also can occur to offset the loss in value.
What’s the statute of limitations on diminished value claims?
New Mexico is a diminished value state per statute 66-5-301. You have up to four years from the date of your accident to file a diminished value claim.
Additionally, New Mexico has uninsured motorist coverage for diminished value. That means all insurance companies must offer this coverage to accommodate for accidents with uninsured or underinsured vehicles.
How do property damage attorneys prove my case?
Property damage attorneys follow a basic principle when proving your property damage claim. They look for evidence that supports your assertion that another person’s negligence cost you money.
One of the first things your property damage attorney does is request a police report for the accident. Most accident investigators indicate the at-fault party in their reports. Similar documentation also should be available from the insurance claims adjuster.
Diminished property value can be tricky to prove, so most property damage attorney rely on opinions and testimony from experts in the field to bolster your case.
Should you hire a property damage attorney?
If you’re serious about proving your diminished value case, working with an experienced property damage attorney is essential to your success. While you aren’t required to hire a lawyer, working with one can maximize your chances of getting adequate financial compensation.
Bill Russell possesses extensive knowledge of property damage laws in New Mexico. He’s not afraid to go the extra mile to ensure you receive fair compensation for your accident, including covering the diminished value of your vehicle.
Contact Bill today to schedule your free case evaluation.