How much a car accident devalues your car depends on a few factors including:
- The vehicle’s value before the accident
- The damage history of the vehicle
- The severity of the accident and the damage the car suffered
- The quality of the repairs
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What Factors Affect the Value of My Vehicle After a Crash?
The value of your vehicle after an accident will vary depending on a number of factors including:
The Value of the Vehicle Prior to the Accident
Vehicles have different starting values based on their year, make, model, color, features, and style. Classic vehicles or vehicles with expensive features that are difficult to repair or replace may see a more significant decrease in value after an accident than standard vehicles.
The History of Prior Damages to the Vehicle
Vehicles that have been in accidents before are worth less on the market, even well-maintained vehicles with full repairs. The higher the number of accidents your vehicle has been in, the lesser the value of your vehicle.
The Nature and Severity of Damages the Vehicle Sustained
Mechanics can repair a vehicle that has sustained minor damages, such as a broken taillight or a small dent in the bumper, by using factory replacement parts that make it almost impossible for anyone to see the repairs.
However, vehicles with more serious damage, such as broken axles or bent frames, will have evidence of the repairs, even if they are high-quality repairs. Any noticeable flaws, particularly those related to safety, will decrease value significantly.
The Quality of the Repairs Performed
Not all repairs are created equal. Faulty repairs or the use of poor quality replacement parts can cause the value of the vehicle to diminish.
Why Does the Value of a Vehicle Decrease After an Accident?
There are three reasons why vehicles lose value after a crash:
- Inherent diminution: Every vehicle automatically loses value after a crash, no matter how good the repairs are.
- Claim-related: Cars that have been in accidents lose value because insurance companies refuse to pay for quality parts and avoid recommended repair procedures.
- Repair-related: Diminished value occurs because of the lack of repair techniques.
In any case, buyers do not generally want to buy used vehicles that have been damaged in an accident. As a result, vehicles with both major and minor damage have lesser value than vehicles that have not been in an accident, no matter how good the repairs are.
Will My Insurer Pay for Diminished Value?
Insurance companies may tell you have no right to pursue a loss of value claim and that you are only entitled to the cost of vehicle repairs. This is false. Insurance companies can be liable for your vehicle’s loss of value.
It is true that, in the state of Florida, your insurance contract generally will prohibit you from filing a diminished value claim against your own insurer.
While you may not be able to file a diminished value claim with your insurer, you may be able to seek damages for the diminished value of your vehicle via third party claim. This means that you can file a claim with the insurer of the at-fault driver whose negligence caused your damages.
You will have four years from the date of the accident to file a diminished value claim. If you successfully prove your case, the at-fault driver’s insurer will pay for the loss of value to your repaired vehicle.
If the at-fault driver’s insurer refuses to pay for your vehicle’s diminished value, a Florida accident attorney can help you bring a claim against it in court for loss of value damages. We will prove that your vehicle is worth less now as a result of the accident caused by the other driver’s negligence.
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What Is Gap Insurance? How Can It Help Me?
The minute you drive off the lot with your new car, the vehicle begins to lose value. If you end up in a serious collision, your insurance company will generally only pay the actual cash value of your vehicle at the time of the incident.
Gap insurance is useful in cases where the amount you owe on your vehicle exceeds the diminished value of your vehicle (i.e., when you have been financing your vehicle for five years or longer or have a vehicle that has a tendency to depreciate quickly).
For example, say that the $30,000, 2-year-old car that you owe $20,000 on is involved in an accident. If the market value of your vehicle after the collision is $15,000, and you still owe $20,000 on your loan, this is a $5,000 gap. A gap insurance policy will cover this $5,000 amount.
Get Help Recovering the Compensation You Need
Your car has lost value due to the negligence of another driver. You deserve compensation for more than just the repairs. At the Law Firm of Anidjar & Levine, our attorneys can help you recover loss of value damages from the negligent driver’s insurance company. Call us today to discuss your options: 800-747-3733.