Understanding Diminished Value Claims

 When a vehicle is involved in an accident and subsequently repaired, it often loses market value—even if those repairs are expertly completed. This reduction in value is known as Diminished Value (DV), and it reflects the reality that a previously damaged vehicle is typically worth less than a comparable one that has never sustained damage. This concept has been legally recognized, as in the Moeller v. Farmers Ins. Co. of Washington case, where the court affirmed that unrecoverable physical damage—such as compromised structural integrity—can justify a diminished value claim.

1. Inherent Diminished Value
   This is the automatic reduction in a vehicle’s resale value simply because it has a history of damage. Even after professional repairs, certain elements—such as weakened metal, undetectable kinetic stress, or the inability to replicate factory finishes and seam work—can prevent full restoration to pre-loss condition. The public perception of accident history alone can reduce a vehicle’s desirability and resale price.
   
2. Repair-Related Diminished Value
   If the repairs performed are substandard or incomplete, the resulting flaws can further reduce the vehicle’s value. This might include poorly executed welds, mismatched paint, sanding scratches on trims, or overlooked frame repairs. Importantly, the insurer remains responsible for ensuring that all work meets pre-loss standards. If a shop performs inadequate repairs, the insurance company may still be obligated to cover the resulting loss and may seek reimbursement from the repair facility afterward.
   
3. Insurance-Related Diminished Value
   This occurs when an insurer-authorized appraisal or repair estimate fails to address all necessary procedures and parts. Whether due to lack of training, restrictive internal policies, or willful underpayment, any missed damage or omitted work directly impacts the vehicle’s market value. When inferior or non-OEM parts are used, or critical repair steps are skipped, the responsibility still lies with the insurer to make the policyholder whole.
   
   

• How do I know if my vehicle qualifies for a DV claim?
  If your vehicle was repaired after a collision, especially one where you were not at fault, it likely qualifies. Age, mileage, the severity of damage, and the quality of repairs all factor in.
  
  
• Can I file a claim even if I wasn’t at fault?
  Yes. You can pursue a DV claim against the at-fault party’s insurance. If the other driver was underinsured, your own policy may cover the loss under certain provisions.
  
  
• How long do I have to file a claim?
  Time limits vary by state but generally range from 2 to 6 years from the date of loss.
  
  

At Goldeneye Appraisal, we provide objective, independent assessments of your vehicle’s post-repair market value. Our detailed evaluations support your DV claim by identifying and documenting any reduction in value caused by the accident and subsequent repairs. We work with consumers, attorneys, and insurance professionals to ensure fair compensation for the loss in value.