Where do some of these “diminished value experts” people get off?

I agree that insurance companies are not so inclined to pay diminished value, and people sometimes get dollar signs in their eyes when they are involved in an accident that is not their fault.  The reality is that diminished value exists, but it is definitely hard to prove. There are arguments that adjusters use all the time to try and dismiss a valid claim and save a few bucks.  The problem is that most of the “diminished value experts” out there have never actually been adjusters.  Through a little research of my own, I have found that at least four of the companies that heavily advertise diminished value services have never even had an adjuster’s license, much less actual experience adjusting.

Tactics like picking and choosing favorable points from different case laws or inappropriate “rules” are all too common.  The fact is that it takes someone who has experience adjusting claims, and has experience evaluating vehicle damages and values to properly evaluate the loss in market value of a vehicle.  Simply being an auto salesman or a damage appraiser is not enough (in my opinion).  Each only deals with one aspect of any vehicle’s value.  The salesman is out to sell a vehicle for a profit and deals in retail values and “trade in” values, and the damage appraiser is trained to identify damaged parts, and on repair methods.  Neither alone makes for a good diminished value appraiser.  Even someone who has both experiences under their belt is not the prime candidate.

I have to toot my own horn a little in this field as I have been in front of Judges and have been challenged by attorneys as to the level of my expertise in determining diminished value.  It is complicated.  First of all, the most common type that is owed by an insurance company is inherent diminished value.  One of the factors that goes into my formula for inherent diminished value is a fluctuating factor, “current market trends”.  I have recently written a report, and since it is likely going to litigation, I won’t give details, but I’ll give a similar example so you can see my point.

If one owns a vehicle that is over 8 years old, many companies will not consider diminished value on the vehicle (until their insured is involved in a lawsuit).  It is ridiculous to use this type of a “rule”.  What if I have a 1965 Ford Mustang that is damaged in a collision?  The marketability of the vehicle is a primary factor in determining how much value it could potentially lose due to sustaining collision damages and having to be repaired.  In addition to the market tendencies, the location of the damages, the components damaged, the general condition of the vehicle and a many more factors are needed in order to accurately estimate a loss in market value.

If you are an insurance company that will not appropriately evaluate diminished value, be advised that I am out here, and my reports will be admitted at trials as my methods and credentials will pass a “Daubert Challenge”.  I do not inflate any diminished value claim, and many times, I do not find any diminished value.

If you believe you have a diminished value claim, before you go off threatening suit, be sure your evidence is sound and not just some report filled with speculation by an untrained party.

18 Comments

  • My daughter was the victim of a broadside hit (thankfully not hurt). We had posseseion of the new 2010 Ford Escape for less than 72 hours and had put just under 100 miles on the vehicle. The repairs (Under $ 5,000.00) will be complete in the next couple of days.

    I really have idea what the impact of DV will be since the vehile is so new.

    Keith…Dallas, TX

  • Keith,

    Your situation is tough. A new vehicle’s potential market is hard to determine. On the other hand, the vehicle has surely suffered some inherent diminished value. I’m glad no one was hurt. I am always available by e-mail at [email protected], and I can be reached by phone at 214-414-7985 if you would like to discuss this matter in person.

    Frankly, I have no idea what the diminished value would be either, but I can determine it. That is what my clients pay me to do. I produce credible diminished value reports based on actual data. I don’t like to pre-judge how an insurance company will handle your claim, but I urge you to make a phone call to me before you begin pursuing your claim. I’m sure I can point you in the right direction for free, and if you happen to need a report, when it comes time for that, I am here.

    Sincerely,

    Justin Petty

    Thanks for reading my blog!

  • Mr. Petty – first thanks for your blog.
    I wish you were a little closer to the Houston area

    I was recently hit while sitting still at a stop sign in my pristine mint 96 Impala SS with only 21k on the odometer. The car is reparable but with yard parts due to the age. But it will never be the same (all Original).

    Several have suggested I file a diminished value claim since the car is considered a collectable.

    What is your opinion?
    Thanks Fred

  • Fred,

    Surely there is some diminished value on your vehicle. The mileage and the model (being an SS) make it a very desirable vehicle in the private market. You will have a tough time on this one due to the age as many insurance companies try and use a blanket rule that says a vehicle that is older than X years can’t have diminished value. This is simply not true, but it takes an expert report to back you up and normally takes filing a small claims suit. I have had many like this and am normally able to help my clients successfully recover their claims without actually crossing the line into legal representation. As an example, one of my clients collected over $700.00 on a 1998 Honda Accord base model with over 120k miles on it. It was a long shot, but due to the economy and the general perception of the public that Honda is of good quality, the vehicle still had a market, which is what matters. Your vehicle definitely has a market, but researching and documenting the loss in value on a vehicle such as that will require somebody with some credentials in order for a dim val claim to be taken seriously.

    On an up note, if you want the best, we have recently partnered with a company that provides us with quality inspections throughout the US. I can get your repaired vehicle inspected, and can write you a quality and credible report without ever having to actually travel to Houston. The cost for an inspection outside of my local area is $75.00, and then the cost of my report remains $250.00. Let us know if you want some help, we are always here. We refuse to refer to any other company as we do not believe they can match our quality, and can’t afford bad word of mouth. Good luck!

  • Hi,

    I received a final offer from the at fault party’s insurance company that comes up around $1000 less than what my paid appraisal estimates I should get. The insurance company based their offer on an appraisal from a company they paid to do a report. The main difference between our reports is that their report doesn’t seem to have any market quotes from local dealers. Their report states their estimate is the “OPINION” of the appraisal board. So I want to get what I think I deserve based on my vehicles previous clean record, marketability, exclusivity (low number sold in the US), and dealer appraisal (3 from report and 1 I got personally). Going to small claims court do I list the insurance company or negligent party as the defendant? Do I have any other option I need to look at before going that route on our differing figures?

  • If you go the small claims route, then you must name the individual. You cannot sue their insurance company. If you are $1000.00 off, my suggestion would be to attempt to negotiate a little bit and settle. Without seeing both your report and the report from the insurance company, I would not speculate as to which is most credible. I will say that there is an accepted scope and methodology for appraising damages and it can be found by searching for the Uniform Standards of Professional Appraisal Practice

  • I like your 1965 Mustang example. Well, I am the owner of a 1965 Mustang that was recently hit in the driver side quarter panel. Car is completly restored prior to collision. Is there any chance of a DV claim,or should I just let it go? My agent said I could try, but probably won’t get it.

  • You definitely have a claim on the 65 Mustang, but without more detail it would be hard for me to give you an opinion on whether it is worth pursuit. We will investigate and provide you with a figure for free at our site, or upon receipt of the information that we need.

    Anybody that says you probably won’t get it clearly has no clue as to how to calculate or prove lost value. My company has a 100% success rate, no kidding. I screen customers well, and if you don’t have a claim, I’ll know it, but if you do, I’ll know how to instruct you so you get paid. Look up Petty Details, LLC and give us a call. The trick is knowing they owe you and demanding it properly.

  • Justin – great post

    I am in Arlington, Texas. On December 1, 2012. My boyfriend and I were hit from behind while sitting at a stoplight on Cooper Street in Arlington, Texas. I drive a 2009 Acura TL. The car has been fixed and damage total came to $10,405.00. I recently went after diminished value from my insurance company because the driver that hit me was not insured. I asked for $3,000.00 ( a quote received from the ACURA dealer I bought the car from) and GEICO has offered 500 so far. This car has received structural damage and will never be the same. Any suggestions? By the way, I contacted this Company called Autoloss.com, researched the company and OMG there are so many companies out there that want to rip you off it is unbelieveable. Any thoughts? [email protected]

  • I drive a 2008 Toyota Camry and I was recently hit from behind while stopped in a traffic jam. My car is currently being repaired, with estimated damages of about $4,000. I bought this car pre-owned and it had been involved in a minor collision prior to purchase. (No frame damage). My question is, if the car already has an accident history, even though minor would I still be able to claim diminished value from another accident?

  • I was recently hit from behind while I was stopped in a traffic jam. My car is currently being repaired, with estimated damages of about $4,000. I drive a 2008 Toyota Camry, and I bought it pre-owned 2 years ago. According to the CarFax report, it was involved in a minor collision prior to my purchase, but with no frame damage. My question is, can I still claim diminished value for a second accident?

  • So Lindsey, you can claim diminished value even on a vehicle that already has a damage history. As you would think, the amount of damage a vehicle sustains is directly related to how much stigma remains after the repair. The trick is calculating the DV on the first accident and adjusting the value of the vehicle for the DV on the second accident. We have had plenty where a vehicle had a minor wreck that didn’t affect the value too much, then a subsequent crash that caused a lot of damage and more stigma loss. We evaluate these cases for attorneys, insurance companies and individuals for free, send me the damage estimates you have and I’ll tell you if you have a claim worth pursuing.

  • My car was in an accident which was other parties fault. Their insurance company paid for repairs and I was claiming diminished value of my car, for which I have submitted them an appraisal report.
    they came back saying that my vehicle was in an accident by previous owner and they had claimed diminished value at that point and they are not going to pay me diminished car claim. They also said that insurance will not pay DV claim on my car as it has been in previous accident already. Is it right.

    • Kal,

      Justin’s response to your question was this:
      One accident is bad, two is worse. Diminished value is determined on a case by case basis. Is the appraiser that did your report unable to help you?

      • Thanks Jennifer for the quick response. I have not asked the appraiser about this yet. but will call him today and get his opinion as well. Does the law of Texas states that the previous accident voids DV claims on future accident claims.

        • No problem! There is no law that says a person cannot recover diminished value twice. In fact, Justin’s appraisal testimony on a case against State Farm was on a second accident, and the Judge awarded diminished value a second time.

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