Each week we report on the most interesting and informative articles concerning auto diminished value claims. A diminished value appraisal of a Honda Accord LX Sedan with 41,256 miles that was involved in a Rear-End Collision that caused $7,004.72 in damage. The vehicle was disabled/towed, had structural damage and no air bag deployment. The claimant hired an independent auto appraiser and made a third-party inherent auto diminished value claim for the vehicle’s loss in value. Once a car is repaired after a collision, it is worth less, often much less depending on the severity of the damage. Regardless of how well the repairer did his job, nobody will pay as much for a previously wrecked car as they would for an identical one that was never in an accident. Presenting a diminished value claim and following it through to a satisfactory conclusion is a daunting task for the average person. Obtaining a comprehensive Diminished Value Report is key.
We learned from these examples from sales managers at Honda dealerships in Alabama – One dealer said that Hondas hold their value pretty well but in the case of frame being compromised and accruing 7K worth of damage you may see a loss of 30% or more. Another dealer said that they would take it as a trade in but due to the bad Carfax showing frame damage you could be looking at losing 40% of the value.
The opinions of six unbiased professional sales managers at recognized new car dealerships form the basis for the most comprehensive Auto Diminished Value Appraisal available. We obtain six of them to validate the diminished value report prepared by The St. Lucie Appraisal Company. This is what the car owner will experience in the real world.
The six dealers providing opinions regarding diminished value were given information specific to this vehicle including year, make, model, mileage, pre-accident condition, color, options, any other pertinent equipment, date of loss as well as the nature of the repaired damages and the manner in which the vehicle was repaired. Dealer opinions are based on personal knowledge and access to auction results. Dealers were advised that this vehicle was properly repaired.
We contacted several Honda dealers in Alabama to establish how these repairs and the resultant repair history would impact this vehicle’s Fair Market Value (FMV.) Dealers were provided with an evaluation of the vehicle’s condition both prior and subsequent to repairs.
A Diminished Value Claim in Birmingham, AL
Description of damage: Disabling collision damages to the Rear including damage to structural components and no air bag deployment. Repair cost $7,004.72. LKQ (used) and/or aftermarket parts were not utilized in the repair/not factored in to the diminished value.
The average of six (6) deductions was 35.42%. This is the percentage of Diminished Value to be taken from the FMV at the time of loss.
We established that the above captioned vehicle had a Fair Market Value (Average Trade-In Value) of approximately $12,500.00 at the time of loss. The Diminished Value was $4,427.50
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