: Depreciation as a result of an accident - need opinions and facts



DPL
07-22-13, 02:10 PM
Hello everyone,

2 months ago my V got hit while parked. The damage was a $10k hit and 2 months in the shop. I finally got the car back and it appears the work was good quality with the exception of 2 scratches on the trunk which can't be buffed out. They are small enough for me to not care too much because I can't stand to have my car back in the shop any longer.

In talking with my insurance adjuster, I am putting forward the notion that my car has depreciated as a result of the accident and made it more difficult to sell in the future. I explained that this isn't your everyday car. Mine is an 09 Thunder Grey 6MT with every option available. 22k miles and it is as close to mint as one can get. I have treated this car with extreme care, much like many of you. I explained to the adjuster that the car is of collectible status with such low production numbers.

The adjuster has asked me to provide whatever I can in terms of backup to the proposal that the car has a lower value now than it did before the accident.

So I ask you. What is your opinion? Does anyone have any links to information that might help me?

Thanking everyone who replies. Much appreciated.

spearfish25
07-22-13, 02:31 PM
It's called a diminished value claim. It varies by state. You don't have to prove the diminished value yourself. They need to offer you a number and you can argue it if its not generous enough.

Give the adjuster the bill for the repairs stating the car was in an accident. That's proof enough of diminished value. That guy sounds like an a-hole and an idiot.

Trapspeed
07-22-13, 02:33 PM
+1. This is on them, not you. All you should have to do is ask for it. They've heard of it before.

DPL
07-22-13, 02:40 PM
I should have stated we're dealing with ICBC. Here in British Columbia Canada we have one auto insurer and its our government.

RGaret
07-22-13, 03:45 PM
I live in NY state and here there is no recognition of diminished value. But it cuts both ways. If the car is stolen, they still have to pay you the same money as if there had been no accident.

spearfish25
07-22-13, 05:27 PM
we're dealing with ICBC. Here in British Columbia Canada we have one auto insurer and its our government.

The plot thickens. I don't know how you prove diminished value. Maybe have a government adjuster come to a dealership with you, tell the salesman you want to trade the car, get a number, and then tell him it's been in an accident. The new number is your diminished value which you can then tell the adjuster you want the difference of the two in cold hard cash.

RaVeNous
07-23-13, 08:32 PM
If you live in an at fault state, and you're at fault it would be an uphill battle. If you live in an at fault state and the other party is as fault, and thus paying for all repairs you might be able to negotiate depreciation into the settlement. In a no fault state, it really depends on the policy and company as how long you're willing to hound them. In all cases they will attempt to get you to settle ASAP.

What you need to do, is run appraisals from edmunds, autotrader, and kelky blue book for you car both as if there are no accidents, and another with the accident added into the formula. I think autostrader and or edmunds even has a line item for accidents and frame damage accidents. You will see a significant difference in both estimates. This is your negotiation amount that you should ask for. In the end you're screws anyway as accidents do hurt resale value a lot. But...at least getting a bit extra Ina settlement will help.

nynd
07-23-13, 09:35 PM
Easiest thing is to take it into a couple of Cadillac dealers and price out a new one. Then get the trade in value (current as opposed to pre-accident if they can tell you or write it) as to how much of a loss it is. Canadian Black Book also has estimated values - may want to check that out (I think it shows an average asking price of $48K.. but depends on what ththey actually sell for). Dealer I would hazard would give in the range of $35K to $40K trade in as you will save tax diff as well.

Here is another link... http://a-professional-appraisal.ca/helpful-info/diminished-value-claims/diminished-value-insurance-claim/

DIMINISHED VALUE: IS YOUR CAR WORTH LESS AFTER REPAIR?
By: Michael Alexander, JD

Let’s say you’ve been rear-ended. The accident isn’t your fault. And your insurance company has paid to have your car repaired, just like new. You think everything is fine until you go to trade your car in two years later and the dealer tells you he can’t pay market value. He says your car has “diminished value” based on the assumption that it will never be as sound as it was before the accident, in spite of the high quality repair.

You’re feeling ripped off. If your car was worth less after repair, why didn’t your insurance company compensate you for your full loss – the cost of the repair and the depreciated value of the car? That is a question that will have to be asked in Ontario, where the concept of diminished value has yet to be recognized by the courts. However, the British Columbia Supreme Court has applied the concept in two recent cases: Cummings v. 565204 B.C. Ltd. (2009) and Signorello v. Khan (2010).

As a result of these rulings, a BC plaintiff, seeking damages for diminished value or “accelerated depreciation,” can sue the driver who caused the damage, as well as his employer, if the driver was using a company vehicle in the course of his employment. The BC courts have used a basic common law tort principle, which holds that someone suffering property damage deserves to be compensated for the full value of his or her loss. To sue the party-at-fault, the plaintiff must tender solid evidence that dealers or appraisers would depreciate the car due to the accident.

Since these BC cases were decided based on Anglo-Canadian common law, which generally applies to all provinces, these cases are potentially applicable in Ontario. A diminished value case is waiting to happen in our courts.

Bottom line: You should consider suing the negligent party, and perhaps even your insurer, for diminished value, which could be a substantial sum if you own an antique or high-end luxury vehicle.

Michael Alexander, Lead Strategist and Innovation Counsel at BT10 Networks, defeated State Farm U.S. at the Supreme Court of Canada in 2005, saving Canadian consumers hundreds of millions of dollars in new insurance premiums. For further information, contact him directly at ma@bt10networks.com or see the firm’s website at www.bt10networks.com

baabootoo
07-24-13, 10:40 AM
If it looks, drives, and works the same, there is no diminished value in WI. Only time and miles do that.

DPL
07-24-13, 12:10 PM
NYND - Excellent post, I thank you.

RaVeNous
07-25-13, 12:47 AM
If it looks, drives, and works the same, there is no diminished value in WI. Only time and miles do that.

False - accidents in the history of the vehicle do reduce the value of the car. Would you pay the same for a car with a major front end collision and frame damage? Tat is the diminished value you can go after either as art of the settlement or via small claims court if insurance isn't playing nice. State laws may effect options.

MoistCabbage
07-25-13, 01:02 AM
Accident damage has never affected value of any car I've bought or insured, or cars of friends and family that have had accidents. The value of the car gets lowered by the amount the insurance company pays out for repair, until the repair is complete. Then the insured value goes back to normal.

Neither NADA nor KBB take previous collision damage/insurance claims into consideration, only current condition.

IBMike
07-25-13, 07:39 AM
Accident damage has never affected value of any car I've bought or insured, or cars of friends and family that have had accidents. The value of the car gets lowered by the amount the insurance company pays out for repair, until the repair is complete. Then the insured value goes back to normal.

Neither NADA nor KBB take previous collision damage/insurance claims into consideration, only current condition.

The insurance company and NADA/KBB may not account for it, but try and sell it, especially now that anyone can get CAFAX data, and a buyer will certainly be wary to buy your vehicle and will likely expect to pay less... why pay the same price for a vehicle that has been in an accident when you can get one that hasn't and feel more confident it is good to go. Certainly affects confidence in your vehicle, which can also result in taking longer to sell it.