Even a relatively minor car accident can result in two separate financial impacts. First, there's the cost of repairing the damage to your vehicle. If your insurance company doesn't choose to list your car as a total loss, then you'll need to restore it to its previous condition. The second impact comes much later, in the form of diminished resale value.
Unless you intend to keep your vehicle for the rest of your life, you will eventually want to sell it or trade it to a dealership. Insurance claims go onto your vehicle's history report, ultimately impacting its long-term resale value. An accident can increase your car's depreciation rate by up to 25%, potentially leading to a significant financial hit.
In many cases, filing a diminished value claim against your insurance company may allow you to recover some or all of this value. You will need an expert to assess your vehicle and establish its reduced value. Knowing when and how to hire an appraiser can help you to expedite the entire claims process. These three tips will help you to recover your financial damages.
1. Don't Rely on the Adjuster
It's essential to understand that your claims expert should be a neutral third-party. Your insurance adjuster's job is to assess the cost of repairing your car to its previous condition, not its long-term resale value. By hiring an expert, you will receive a more accurate assessment of how your vehicle's repairs will impact your ability to sell it later.
More importantly, an expert will have the tools necessary to evaluate the impact of accidents in your local auto market. Most diminished value appraisers will check everything from local classifieds to dealership auctions to determine the effect of negative vehicle histories on their sale value. This thorough approach will provide you with a better estimate of your actual loss.
2. Get An Appraisal Before Repairs…
Your appraiser should check your car before you begin repairs. This early assessment will allow them to evaluate the extent of the damage entirely. By only appraising the vehicle after repairs, your appraiser may undervalue your claim. If you've already started repairs, then be sure to provide the appraiser with any detailed pictures or adjuster reports that you have.
3. …And After Repairs Are Completed
Although you'll want a first appraisal (if possible) while your car is still damaged, it's the after-repair report that matters the most. Your appraiser can evaluate the quality of the repairs to determine where on the diminished value range your vehicle may fall. High-quality repairs can often offset some of the financial loss, while lower quality repairs may mean a significantly reduced final value.
When your vehicle is in an accident, you are entitled to recover all of your losses. For your insurance company to make you whole, they must also cover your car's diminished value. Don't hesitate to file a diminished auto value claim any time you believe an accident has reduced your car's resale value.