Diminished Value Claims
Consider the following:
Lets say your car is worth $5,000, according to the N.A.DA. The all of a sudden your in an auto accident and you have to make a claim for the repair of your vehicle from the at fault party. Your car is repaired then you decide to sell the car. As you shop your car around, you find that you can't get anything near $5,000 for it because it was wrecked and repaired.
What happened?
Your car has suffered what is known as a diminished value loss AKA diminution loss.
It has been argued that the insurance company should be obligated to return their automobiles to "pre-loss condition" after accidents. A monetary value is usually attached to that condition, and owners say that a car that's been in an accident will fetch a lower price when sold compared with a similar car that hasn't been crashed that a car's value inherently diminishes after it's been in an accident, regardless of the quality of the repair.
Consumer advocates have long held that owners should be entitled to a diminished-value check from their insurers if they can document that their vehicles have suffered a loss.
The diminished value debates have raged for years because most car insurance companies dont want to pay this claim for real or perceived decreases in a vehicle's value after a crash, even if the vehicle has been repaired to its original condition. Insurers argue that diminished value is not covered loss, but consumers and our Law Firm disagree, when it comes to recovery 3rd party losses in Texas.
Third-party claims
If someone else hits you and you make a damage claim on that person's insurance. That's called a third-party claim and it's possible to get diminished value damages as a third party because you don't have a contract with that insurer. The insurance company's diminished-value exclusion form applies only to first-party physical-damage claims, not to third-party liability claims.
Also, in tort claims, the measure of damage is generally calculated as the difference in value before and after the loss, sometimes making diminished value a viable claim. However, there is still a wide variation among state case law in pinpointing when a third-party claimant is entitled to diminished value. At least in Texas, it is our belief if you can properly document the loss, the claim can be made.
Collision-repair industry has mixed feelings
The Automotive Service Association (ASA), an auto industry group, contends that "your vehicle can and should be restored to pre-accident condition." The ASA outlines several steps repair facilities should take to ensure a "proper" and "quality" repair of your vehicle: Repairers should use the best refinishing and paint products and specialists; repairers should use only highly skilled welders who do repairs in accordance with the vehicle manufacturers' recommended procedures; and repairers should be able to pinpoint all damage. In short, the ASA contends the "repair should be a comprehensive reconditioning to original specifications."
Auto manufacturers spend hundreds of millions of dollars on equipment that precisely aligns car parts and paints car surfaces. Auto repair shops, even the most advanced, cannot afford and do not have the space for manufacturer-type equipment; therefore, the repairer is never going to return your car to the way it was when it came off the factory assembly line. Body shops do the repairs by hand, and when you do it by hand, the allignments will not be perfect. The average person may not be able to tell the difference in the quality of the repair, but auto appraisers can.
FOR MORE INFORMATION CALL ATTORNEY GARY GIBSON - WITH THE CARABIN & SHAW LAW FIRM. CALL 210-222-2288
Lets say your car is worth $5,000, according to the N.A.DA. The all of a sudden your in an auto accident and you have to make a claim for the repair of your vehicle from the at fault party. Your car is repaired then you decide to sell the car. As you shop your car around, you find that you can't get anything near $5,000 for it because it was wrecked and repaired.
What happened?
Your car has suffered what is known as a diminished value loss AKA diminution loss.
It has been argued that the insurance company should be obligated to return their automobiles to "pre-loss condition" after accidents. A monetary value is usually attached to that condition, and owners say that a car that's been in an accident will fetch a lower price when sold compared with a similar car that hasn't been crashed that a car's value inherently diminishes after it's been in an accident, regardless of the quality of the repair.
Consumer advocates have long held that owners should be entitled to a diminished-value check from their insurers if they can document that their vehicles have suffered a loss.
The diminished value debates have raged for years because most car insurance companies dont want to pay this claim for real or perceived decreases in a vehicle's value after a crash, even if the vehicle has been repaired to its original condition. Insurers argue that diminished value is not covered loss, but consumers and our Law Firm disagree, when it comes to recovery 3rd party losses in Texas.
Third-party claims
If someone else hits you and you make a damage claim on that person's insurance. That's called a third-party claim and it's possible to get diminished value damages as a third party because you don't have a contract with that insurer. The insurance company's diminished-value exclusion form applies only to first-party physical-damage claims, not to third-party liability claims.
Also, in tort claims, the measure of damage is generally calculated as the difference in value before and after the loss, sometimes making diminished value a viable claim. However, there is still a wide variation among state case law in pinpointing when a third-party claimant is entitled to diminished value. At least in Texas, it is our belief if you can properly document the loss, the claim can be made.
Collision-repair industry has mixed feelings
The Automotive Service Association (ASA), an auto industry group, contends that "your vehicle can and should be restored to pre-accident condition." The ASA outlines several steps repair facilities should take to ensure a "proper" and "quality" repair of your vehicle: Repairers should use the best refinishing and paint products and specialists; repairers should use only highly skilled welders who do repairs in accordance with the vehicle manufacturers' recommended procedures; and repairers should be able to pinpoint all damage. In short, the ASA contends the "repair should be a comprehensive reconditioning to original specifications."
Auto manufacturers spend hundreds of millions of dollars on equipment that precisely aligns car parts and paints car surfaces. Auto repair shops, even the most advanced, cannot afford and do not have the space for manufacturer-type equipment; therefore, the repairer is never going to return your car to the way it was when it came off the factory assembly line. Body shops do the repairs by hand, and when you do it by hand, the allignments will not be perfect. The average person may not be able to tell the difference in the quality of the repair, but auto appraisers can.
FOR MORE INFORMATION CALL ATTORNEY GARY GIBSON - WITH THE CARABIN & SHAW LAW FIRM. CALL 210-222-2288
