There’s a Louisiana statute that not many people know about. It applies to vehicles which have been damaged due to third-party negligence. When accident victims come to Ascend Disability Lawyers LLC, this is one of the things we educate them about.
Under Lousiana Revised Statute 9:2800.17, vehicle owners can receive compensation for the reduced value of their vehicle after an accident. The law refers to when a vehicle sustains damage but is not destroyed because of a third party’s negligence.
Specifically, the law states: “Whenever a motor vehicle is damaged through the negligence of a third-party without being destroyed, and if the owner can prove by a preponderance of the evidence that, if the vehicle were repaired to its pre-loss condition, its fair market value would be less than its value before it was damaged, the owner of the damaged vehicle shall be entitled to recover as additional damages an amount equal to the diminution in the value of the vehicle. Notwithstanding, the total damages recovered by the owner shall not exceed the fair market value of the vehicle prior to when it was damaged, and the amount paid for the diminution of value shall be considered in determining whether a vehicle is a total loss pursuant to R.S. 32:702.”
Unfortunately, insurance companies in New Orleans don’t tell accident victims that this type of compensation is available. They also don’t pay it without a fight. That’s where diminished value lawyers come in. We educate drivers whose vehicles received damage because of third parties. We then make a strong case to insurance companies to pay our clients the money they deserve. Compensation for diminished value can be substantial depending on the car and circumstances.
An In-Depth Explanation of Diminished Value from a New Orleans Diminished Value Attorney
When a car has been damaged, it’s valued automatically diminishes. Even after it has been repaired, the car’s value doesn’t return to pre-crash levels. It has diminished value in the minds of prospective buyers after they find out it has been in an accident. The amount they are willing to pay may be considerably less than if the car had not been hit. Some people won’t want to buy the car at all depending on the details of the damage.
It is believed that value diminishes because after-market parts may be used when the car is repaired. However, even when original parts are installed by an authorized dealer, the perceived value of the car drops.
As a vehicle owner whose car was damaged through someone else’s negligence, you shouldn’t have to suffer. You shouldn’t be forced to accept a reduced payment when the accident was not your fault. A New Orleans diminished value lawyer would insist that you get additional compensation for this.
There are three ways in which a car’s value may diminish after a crash.
- Immediate Diminished Value. This refers to the difference in the vehicle’s resale value from before the accident to when repairs are done.
- Inherent Diminished Value. This is based on the premise that the vehicle was repaired to its original condition. However, it now has a history of having been in an accident. The perception now affects the price the owner would get if they tried to sell or trade-in the vehicle.
- Repair Related Diminished Value. This is the reduced value which results directly from the quality of repairs. Generic parts may have been used or the paint may not be an exact match. The vehicle, therefore, has less value than it did following the accident. This is beyond the inherent diminished value from having been in an accident.
The difference in value pre- and post-accident can be a lot. That is why it is important to have a diminished value attorney fighting for your rights. They can assist you with filing the necessary claim with the other driver’s insurance company.
How to Go About Filing a Diminished Value Claim in New Orleans
Diminished value claims are separate from the usual property damage claim you will file after an accident. Insurance companies will not willingly offer diminished value compensation. You will have to demand it with help from your diminished value attorney. This claim can be made after the property damage claimed has been settled. This is because under the statute mentioned earlier, diminished value is an additional claim.
You will need to request a specific amount of money from the insurance company. You have to ask them to compensate you for the difference in value. If your vehicle is new, this is likely to be a few thousand dollars. However, as with any other application for compensation, you will need to present evidence to support your claim.
You will need to present evidence showing the value of the vehicle before and after the accident. You will also need to indicate the condition the vehicle was in before the accident. To help buttress your claim, your application should include expert testimony.
The expert should understand how knowledge of an accident history can affect the perception of potential buyers. A knowledgeable car dealer would be a good source. They can also testify to how the accident had a significant impact on your vehicle’s value. It would be difficult to put together all this information on your own. The services of a New Orleans attorney are priceless in this situation.
To get an idea of the pre-accident value of your vehicle, consult a site like Kelley Blue Book. You can then ask a dealership to give you an estimate of the trade-in value of the car. This can help you to get a clear idea of the figures involved. You can also consult a company which specializes in diminished value claim valuations.
You should bear in mind that diminished value compensation is not paid for first-party claims. If the accident was your fault and you are making a claim against your insurance, you can’t collect it. The claim must be made with the responsible driver’s insurance company. If the responsible driver was uninsured, you will need to make an uninsured motorists’ claim with your insurance company.
When you consult with the attorneys at Ascend Disability, we hear the facts of your case. After taking careful notes, we advise you accordingly. We know the challenges residents of New Orleans face when trying to deal with insurance companies. We also know the law and we will fight for the rights of victims of car accidents.
What You Should Know About the Diminished Value Calculator
You will request a certain amount from the insurance company but they will do their own calculations. As is customary, they will want to pay less than you asked for – if they pay anything at all. Many insurance companies use a flawed formula to calculate the diminished value. The calculators often a set a maximum recovery of 10%. However, the value of a vehicle can diminish by a lot more.
Insurance companies typically use a formula known as “17c”. It gets its name from a section of a document which was filed in a Georgia case. Paragraph 17c contained a calculator that really underestimated the diminished value. It started with an extremely low maximum and then arrived at a low settlement amount. The courts in Georgia don’t recommend the blanket application of this formula but insurance companies like to use it. You will need to fight the insurer’s attempt to use 17c to calculate the diminished value of your vehicle.
It is difficult to predict how much your claim is worth without considering all the factors. Your claim will be impacted by:
- The pre-crash value of the car
- How much it is likely to resell for
- Whether it is a luxury vehicle
- Number of prior accidents
Our diminished value lawyers know how all these factors work together. We will build the strongest case possible and fight for your right to fair compensation.
Things That Can Hurt Your Diminished Value Claim in New Orleans
You have a legal right to claim diminished value compensation. However, there are some factors which can reduce your chances of getting it. These will be outlined below.
The Age of Your Vehicle
No matter how old your car was, it had some level of market value. However, insurance companies won’t see it this way when you file your claim. If your car is more than seven years old, they will not want to compensate you. Your claim will likely be denied since they know the diminished value is not worth a court case. There is little danger to the insurer that you will take them to court if they deny your claim. If your car was only worth $4,000, before the accident, the diminished value won’t be much. Court costs and attorney fees would make it impractical to fight the denial.
However, not all older cars are in poor condition and some still have a relatively high market value. Unfortunately, older luxury cars, low mileage vehicles and well-cared for cars get caught in the seven-year cap. It will take a skilled attorney to convince the insurance company to treat your case differently.
The Mileage on Your Vehicle
As is customary when you’re buying or selling a car, mileage has an impact on worth in diminished value cases. People generally consider cars with low mileage to be worth more than those with high mileage. The higher the mileage, the more repairs the car will likely need. Lots of insurance companies refuse to pay diminished value compensation for vehicles with over 100,000 miles.
This can be difficult to fight. Even most potential buyers are reluctant to purchase a car with that much mileage. However, there are cars with over 100,000 miles with excellent service records. They can be in better condition than some which have lower mileage. Some brands also stay in better condition despite having been used a lot. Depending on the state of your vehicle, these can also be negotiation points for your diminished value attorney.
The Make and Model of Your Vehicle
A Mercedes Benz is worth more than a Honda. All things being equal, the Benz will command a higher price. It will also hold a higher value for longer than a Honda. The Mercedes Benz will, therefore, have a greater diminished value than a Honda. Still, you should not let the insurance company make it seem like your lower-priced vehicle has no value. They should be made to compensate you fairly.
Your Prior Accident History
If your car has been damaged in more than one accident, its value will be lower. However, it is not clear how much value diminishes by following two accidents as compared to one. Still, some insurance claims adjusters will not pay compensation for a second accident. However, let’s say the first accident resulted in only minor damage. Afterward, the car was repaired to a high standard. The car’s value may still be quite high prior to the second accident. However, if the first was a serious accident, the situation may be different. These are all issues which your New Orleans diminished value lawyer will hash out with the insurance company. It certainly isn’t something you want to handle yourself.
Undervaluing Your Claim
Not filing for the full value of your claim can cost you. If you value your claim at $5,000, the insurance company will offer you less. If the diminished value was really $6,000, you have already sold yourself short. Remember, insurance companies will rarely pay you as much as you ask for. They certainly won’t pay you more. You need to make sure that you take all the factors which could affect your claim into consideration. That way, you can ask for the highest amount possible.
Many people use online diminished value calculators and these can produce low sums. These tend to consider only the age, model, and mileage of your vehicle. However, there are other subjective factors to think of. It is best to speak to a qualified appraiser who can evaluate all aspects of the claim. Your attorney can help you to find an expert who can calculate the true value of your claim.
Letting the Claims Adjuster Take Charge
Contrary to what they may tell you, the insurance claims adjuster doesn’t have your best interests at heart. Their job is to negotiate the claim in favor of the insurance company. They are not interested in what is fair. They just want to save their employer as much money as possible. If you are not keen or you don’t have representation, they can take advantage of you. They may try to convince you that your claim has no worth. Also, they may fail to explain procedures properly or try to confuse you. They want you to give up on the claim or accept what little the insurance company offers you.
Claims adjusters don’t particularly like diminished value claims and they would prefer you didn’t know about your rights. Letting them drive the process is not a good idea. You need to have someone with your best interests at heart on your side. You need someone who knows how the system works. Having a diminished value attorney can really make a difference.
Reach Out to the Attorneys at Ascend Disability Today for Assistance
It is not a good idea to try to handle diminished value negotiations on your own. Diminished value attorneys like us at Ascend Disability have seen it all. We know all the tactics insurance companies use. We know how to counter them, having dealt with several such cases in the past. We’ve years of experience serving the New Orleans community and we can put that experience to work for you.
When you contact us for a consultation, we will explain the law governing diminished value compensation. We prove that you have a legal right to compensation if your vehicle is damaged due to third-party negligence. Once your property damage claim is settled, we will go about filing the diminished value claim. You shouldn’t have to suffer when you attempt to trade-in or sell your vehicle. It was not your fault your vehicle was damaged. The at-fault driver’s insurance company should have to pay you for the difference in value.
If you want to discuss your case following a car accident in New Orleans, contact us today. Call us at (855) 631-2544 or fill out the contact form on our website. We are ready to assist you so don’t delay in contacting us.