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In a professional forum for diminished value providers, we had a member inquire about how the amount of the repair bill affects the inherent diminished value of a vehicle. It is my experience that the amount of damages is an imperative factor to have in order to accurately assess diminished value. Let’s dig right into the details. . .
If you don’t know what subrogation is, then this article isn’t for you. In this posting, I am speaking only of personal automobile subrogation recovery. A recent teleconference with some claims professionals made me think of this blog posting.
Subrogation recovery is a difficult skill to master. There are two fundamental approaches to maximizing recovery. One approach focuses on speed, and the other is based on securing the most future money. Think of the fable “The Tortoise and the Hare” and the lesson it teaches. We believe that lesson is well applied in the area of subrogation, and our long term numbers can prove it.
Recently, the Texas legislature enacted a law that abolishes the Small Claims Court in Texas. There are a few articles on the web about it, but for the most part, nobody noticed! After researching the subject matter (thanks to Hal Monk), I found the amended rules.
In every claim I have ever handled where the vehicle was a total loss and had a salvage / rebuilt title, I was instructed to deduct 50% of it’s pre-accident value to account for the salvage / rebuilt status. Also, when I was handling claims for insurance companies, I was routinely told that diminished value did not exist and to simply deny paying for it.
If asked, the main reason for denial was because it was a “stigma” claim, for which we did not legally owe (which was a lie). The next best denial reason was that unless the vehicle sold for a loss due to the repair history, the claim was “unrealized” and there was no claim (also a lie).
Just think about that for a minute if you’re an adjuster. Are you not instructed to deduct 40 – 60 % of the value on a total loss settlement if the vehicle had a salvage or rebuilt title? And are you not instructed to refuse to pay diminished value on vehicles that are repairable? Do you know the law about the matter? I do.
The fact of the matter is that in most cases, if a vehicle has any substantial value, then if damaged and repaired, it will suffer lost market value due to stigma. If your damages were due to another person’s negligence, then their liability insurance company will ultimately have to settle the claim for them if you sue the person.
How is stigma loss documented and how do you sue?
Information is always free at Petty Details, LLC!
Seriously, I sometimes get the feeling that some people just don’t understand how life works, and that causes them difficulty in discerning ordinarily easy facts to observe. Our mission statement at the office is “We are here to prove that paying attention to details and doing the right thing is the key to success in business and in life.” I understand that we can always argue semantics about what is the right thing, but this article should at least demonstrate some of how I think as well as shed some light on how to determine whether an older vehicle has any lost value due to a collision and repair that is worth pursuing.
I assume if you found my blog, you don’t need a definition of inherent lost market value, so, let’s take an older car example and go with it. . .
I truly cannot tell you how many times a claimant threatened to sue the company when I was adjusting insurance claims. All insurance adjuster learn pretty early on that a person will have a hard time trying to sue someone else’s insurance company for bad claims handling, so never was I ever worried when a third-party claimant threatened suit. In fact, I hoped that they tried so they would learn a lesson. Just the fact that they threatened it made it known to me that they had no clue how to fight with me.
Now that I am a private claims consultant, it is still one of the most common questions I get from individuals who are upset about the way they are being treated by an insurance company. If you’ve found this article by searching the internet for “How to sue an insurance company” or some variation, then you are who I am trying to reach. Please continue reading, the following information is 100% true.