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What is Diminished Value?

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Pre-Accident

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Post-Accident

$54,749

$46,454

Sport Car

Filing A Diminished Value Claim In Massachusetts

Statute of Limitations to File: 3 Years 

File First Party Claim: No 

File Third Party Claim: Yes, though not guaranteed 

Diminished Value Through Uninsured Motorist Coverage: None 

Massachusetts Small Claims Max Filing: $7,000

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Massachusetts
Case Law

Generally, a victim of property damage is entitled to be placed in the position he or she would have been in if the defendant’s wrong had never occurred. Tort Law § 13.11, at 429 (3d ed. 2005). A fundamental principle on which the rule of damages is based is compensation. Compensation is that amount of money that reasonably will make the injured party whole. Compensatory damages may not exceed this amount. Anything beyond that amount is a windfall. Kattar v. Demoulas, 433 Mass. 1 , 15 (2000).

Jarrett McGilloway et al. v. Safety Insurance Company and the Commerce Insurance Company COMMONWEALTH OF MASSACHUSETTS SUPREME JUDICIAL COURT:
 

The Supreme Judicial Court differentiated part 4 from part 7 (a first party claim for collision coverage) of the 2008 Edition of the standard Massachusetts auto policy, and held that inherent diminished value is recoverable under a third party claim for damages under part 4 of the 2008 Edition of the standard policy. The Supreme Judicial Court noted that not every automobile that is involved in a collision and is subsequently repaired has suffered diminished value. “Rather, individualized proof is required to demonstrate that a given automobile has sustained some form of diminution in value due to a collision or vehicular accident, even after repairs are made.” A Plaintiff would still need to prove (1) that his or her vehicle has suffered inherent diminished value damages and (2) the amount of diminished value damages at issue.
 

Massachusetts policies written after January 1, 2018 are based on the 2016 Edition of the Standard Massachusetts Automobile Insurance Policy and those polices contain the unfavorable wording that goes against diminished value compensation for third-party accident victims.

A DV Claim can be filed, however there are no guarantees that if it goes to court a favorable outcome for the plaintiff 

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Richart Taylor

Richard W. Taylor, President-Managing Partner
NPN #16425692

Richard was a great help in assisting us with our total loss claim with our own insurance company. Not only did he get us fair market value but he was a pleasure to deal with, extremely helpful, extensively knowledgeable, and couldn't have been more responsive. I cannot recommend him highly enough.

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Rafael Rodriguez, Managing Director California

 

 

Really worth reaching out. Fast and efficient: they finished everything within 6 hours, and insurance approved everything less than 24 hours later. Very professional and kind folks.

Call DVAC at 877-879-0101 for a FREE consultation

Understanding Automobile Diminished Value

Introduction: In the realm of automobiles, the concept of diminished value is crucial yet often misunderstood. When a vehicle is involved in an accident, its value can decrease even after repairs have been made, due to factors such as damage history and perceived reliability. This phenomenon is known as diminished value, and comprehending its implications is essential for both buyers and sellers in the automotive market.

What is Diminished Value? Diminished value refers to the reduction in a vehicle's resale worth after it has been damaged and subsequently repaired. Even if the repairs are performed meticulously and restore the vehicle to its pre-accident condition, the fact that it has a history of damage can impact its value in the eyes of potential buyers.

Types of Diminished Value:

  1. Inherent Diminished Value: This type of diminished value occurs due to the perception that a vehicle with a history of accidents is less desirable than a similar vehicle with no such history, even if repairs have been carried out expertly.

  2. Immediate Diminished Value: Immediate diminished value is the reduction in value that occurs immediately after an accident. It reflects the decrease in the vehicle's worth due to the visible damage it has sustained.

  3. Repair-Related Diminished Value: Repair-related diminished value occurs when repairs, although performed properly, are not sufficient to restore the vehicle to its pre-accident condition. In such cases, the vehicle may still have underlying issues that affect its value.

Factors Affecting Diminished Value: Several factors can influence the extent of diminished value a vehicle experiences:

  1. Severity of Damage: The extent of damage sustained by the vehicle in the accident plays a significant role. Vehicles with extensive damage typically experience higher levels of diminished value.

  2. Vehicle Age and Mileage: Older vehicles or those with high mileage may experience greater diminished value since they are perceived to have less remaining useful life.

  3. Vehicle History: A vehicle's accident history, even if the damage has been repaired, can impact its value. Buyers may be wary of purchasing a vehicle with a history of accidents.

  4. Market Demand: The demand for a particular make and model in the used car market can affect its diminished value. Vehicles in high demand may experience less diminished value compared to those with lower demand.

How to Determine Diminished Value: Determining the diminished value of a vehicle can be challenging and often requires professional appraisal. Several methods may be used, including:

  1. Comparative Market Analysis: Comparing the value of similar vehicles with and without accident histories can provide insight into the diminished value.

  2. Professional Appraisal: Hiring a professional appraiser experienced in assessing diminished value can provide a more accurate valuation.

  3. Diminished Value Calculators: Online tools and calculators can provide rough estimates of diminished value based on factors such as vehicle make, model, age, and extent of damage.

Conclusion: Automobile diminished value is a significant consideration for both buyers and sellers in the used car market. Understanding the factors that contribute to diminished value and how to assess it accurately can help individuals make informed decisions when buying or selling a vehicle. Whether seeking compensation for diminished value after an accident or negotiating a fair price for a used car, awareness of this concept is essential for navigating the complexities of the automotive market.

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