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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Legal
Satisfied Customers: 41221
Experience:  Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
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111mk, My wife and I own a 2008 Chrysler 300. Last year she was hit

Customer Question

My wife and I own a 2008 Chrysler 300. Last year she was hit by a lady that had geico insurance. Geico paid for the rental and repairs. Two weeks ago she was hit again by a man in a parking lot who also had state farm. The car has now been in 2 accidents and we was told that the value may have decreased by as much as 35 percent of the cars value (est $12,000). We would like to recover this diminished value
Submitted: 4 years ago.
Category: Legal
Expert:  Dimitry K., Esq. replied 4 years ago.

Thank you for your question. Please permit me to assist you this evening.

I am very sorry to hear that you are in this situation. However 'diminished value' is generally not covered by insurance. As that is considered to be a 'potential' loss rather than an actual loss, insurance providers do not cover such losses. The insurance company's logic, and one that most courts tend to agree with, is that since you are not required to ever sell the vehicle, you are not going to see the potential loss. All they are required to do is put you back to the same position you would have been had the accident not taken place, which means paying for your repairs and medical bills if any, as well as covering losses of any other items that were directly damaged. But the loss in value is not really actionable. You can potentially review the new person's policy to see if they insure against it, or sue the individual directly for your full losses (which could then include the loss in value), but his insurance is otherwise not legally required to cover loss in value.

Hope that helps.

Customer: replied 4 years ago.

I am confused State Farm told me they would pay the Diminished Value after the repairs had been complete. I also have (2) co-workers who have received the same compensation.

Expert:  Dimitry K., Esq. replied 4 years ago.


Then the person that struck your wife had that as a policy condition, which is very fortunate. In that case you do not need to do anything beyond obtaining an estimate of what your car is worth today versus what it should have been worth without the accidents. This 'diminished value' clause is not a requirement unless it is listed as such on the other person's policy. That is most fortunate, situation aside, as you would then not have to file suit but wait for your check to appear, unless they are claiming that your wife was fault, which is not what it sounds they are doing in this case. Most insurers do not even offer that coverage as an option.

Good luck.