Does Texas Pay Diminished Value Claims?

Most car accidents result in significant damage to the vehicle and bodily injury to the occupants. Even after undergoing costly repairs, it is rare that a car will be restored to its initial value.

In Texas, the law allows you to seek compensation for the diminished value of your vehicle under specific circumstances. You can discuss your options with a San Antonio personal injury lawyer.

Texas Diminished Value Law

Texas requires that you disclose any accident history as you resell your car. In most cases, buyers aren’t willing to pay the total price for vehicles involved in a severe accident. That’s because they consider the car of lesser value even if it displays no apparent damages after repair.

Factors contributing to a vehicle’s diminished value include flawed repair work, such as color mismatch. Insurance companies may also decline to pay for all the necessary costly repairs.

What Does Diminished Value Mean?

Diminished value is the damage your vehicle suffers after an accident and is a way to recover property damage. After repairs, your car will still suffer issues in the future, especially when you want to resell it. Buyers will look at the car’s history and see it as altered, hence won’t want to pay what you think your car would typically be worth.

That represents diminished value. Overall, it is the difference between what the car was worth before the accident and its value post the accident. Consult a skilled San Antonio auto accident lawyer to help you correctly calculate your car’s diminished value. They can also help you file a claim if it applies to your case.

Types of Diminished Value in Texas

Diminished value occurs in three types, namely:

  • Inherent diminished value: It occurs when a vehicle losses value due to its history of damage
  • Immediate diminished value: It is the difference between the resale value immediately after the accident and before repairs. It’s not a commonly used type of diminished value.
  • Repair-related diminished value: The value lost based on low-quality repairs after the accident. It is derived from the notion that restoring a car to its original condition after an accident is impossible.

How Do Insurance Companies Calculate Diminished Value?

Most insurance companies use the 17c Diminished Value Formula to calculate the value. The method entails calculating the car’s current value depending on the make, model, and year. Then they apply a 10% cap to get base value loss. The next step is to calculate the number depending on the level of damage as follows:

  • 1 for severe structural damage
  • 0.75 for major damage to panels and the vehicle’s structure
  • 0.50 for moderate damage to panels and structure
  • 0.25 for minor damage to panels and structure
  • 0 for no replaced panels or structural damage

Vehicle Mileage

Insurance adjusters will also consider your car’s mileage in calculating diminished value. Once they determine the damage level through the above calculation, they will multiply it with the following values based on mileage:

  • 1 for 0-19,999 miles
  • 0.80 for 20,000 to 39,999 miles
  • 0.60 for 40,000 to 59,999 miles
  • 0.40 for 60,000 to 79,999 miles
  • 0.20 for 80,000 to 99,999 miles
  • 0 for 100,000 miles and above

Other factors that may affect the value of your diminished value claim are the history and type of car. However, not all insurance companies use the 17c formula. Besides, adjusters will always try to shortchange you to pay the least amount possible or none at all.

Working with an experienced auto accident attorney in San Antonio can assess your case and fight for your rights. Lawyers know how property damage claims work and can fight for maximum compensation.

How Can I File a Diminished Value Claim in Texas?

Filing diminished value claims in Texas is similar to filing any other sort of insurance claim that requires you to meet some requirements. The first one is to show that another party was liable for the crash to be eligible to file a claim with their insurance claim.

You may also be able to file a claim with your insurance company if the other party’s coverage is not enough to cover your claim. It is also the option to use if you’re at fault for the accident. However, you must have comprehensive, collision, or any other coverage for property damage claims to qualify.

Secondly, you must gather evidence to demonstrate your vehicle’s diminished value. You can get a valuation report from a used car dealer. You also need a quote from a reliable car repair shop to account for all the relevant damages. It would help to work with a skilled auto accident lawyer in San Antonio to enhance your chances of a favorable outcome.

What if the Insurance Company Denies My Diminished Value Claim?

Insurance companies are sometimes quick to deny diminished value claims. In most cases, liability will be the determining factor, with insurance companies refusing to pay for diminished value if you’re at fault for the collision. In such a case, you could only benefit from compensation for diminished value if you have collision coverage.

Depending on the specific policy, the insurance may pay half, less than half, or more. If you’re dissatisfied with the payout amount from the insurance company, a skilled auto accident lawyer in San Antonio can help you appeal the decision and fight for a fair settlement.

A Top Rated Attorney Fighting for a Fair Payment

Dealing with insurance companies to pursue compensation for property damage after an accident can be stressful. A skilled auto accident attorney in San Antonio can evaluate your case and guide you on what to expect to help lessen the burden. They can provide legal representation and face insurance companies on your behalf to fight for fair compensation.

The legal team at the Law Offices of Matthew S. Norris is dedicated to helping car accident victims recover the compensation they deserve for their injuries and damage after a car accident. Our personal injury attorney is skilled and knowledgeable in personal injury law and can fight to protect your rights. Call us at (210) 361-3393 to discuss your claim.