The diminished value of a property is the difference between the cost before and after damage. Diminished value is generally used in the context of vehicles. The cost of the damaged automobile is different from a similar new vehicle. The perception of people for vehicles involved in an accident contributes to devaluing it.
Diminished value was brought up by renting automobiles. Rental companies rent out new cars with low mileage. The rental firms sold and replaced the old vehicle. They knew that when the market devalues the vehicle once they are aware of its history of repair. The amount of damage to the vehicle determines how much it will be sold at. Once the car is involved in an accident its value can never be the same again. The disparity between an original automobile price and its selling price is the diminished value.
Diminished value can be classified into three. Immediate diminished value which refers to the difference in the amount a vehicle is sold at because of the accident it was involved in. Inherent diminished value is the loss of the market value of the vehicle from the accident. It is accepted by most people. The third type is the repair related diminished value. It arises when the car’s value is lowered by repairing it poorly. Some of the automobile parts could not have been repaired. Repair related repair value of an automobile depends on how well the fixing was after the damage.
In most parts of the world, people are allowed to file a diminished value claim after an accident. Uninsured motorist coverage holders can also file for diminished value claims. Diminished value claims can either be first party or third party insurance claims. The first party claim is the one filed by the vehicle owner to their insurance company for compensation. The policy of the insurance company will determine if the owner of the vehicle will be compensated. Third party insurance claims are diminished value claims for the damaged vehicle caused by another person. Diminished value claims are accepted legally in many courts around the world.
The extent of the damage to the vehicle after an accident and the quality of repair is very important in deciding the diminished value of an automobile. The condition of the car and its value before the accident occurred should be put in mind also when determining the diminished value of the vehicle.
Filing for diminished value claims by your own can be very challenging. It is encouraged to seek the help of a personal injury attorney who has the knowledge about the legalities involved assist in filing the diminished value claims. It very important to hire lawyers who are known for their representation abilities.