Diminished Value Auto Claim

[jazz4cash]

I had a fender bender with a Fedex delivery van. They hit my unoccupied vehicle parked in front of my house. The driver knocked on the door to advise. Very minor damage. The claim process is a super PITA. I spoke with 8 individuals including 3rd parties and contractors who all ask the same questions. My truck is only 8 months old so I believe I am entitled to receive a payment for diminished value. Vehicle history will show an accident claim which will reduce resale value. I also need to restore the optional paint sealant that I paid for. The insurance adjuster acknowledges these items but does not seem to know how to file for payment. How is this supposed to work?

 

[jazz4cash]

Update
The bodywork has been completed and paid. The agent for Fedex offered $276 to settle the diminished value claim. I found numerous sources online referencing a standard (Formula 17C) to estimate the loss in value. It is basically 10% of ACV less deductions based on severity of damage and mileage. Based on their market value using Formula 17C I get a diminished value of $750.

 

[mystang52]

I don't have any expertise on Diminished Value. But why not go back to the adjuster and demand that $750? I presume you'd accept an amount somewhere between that and the original offer. In any event, you have a very credible basis for that $750 figure. Your call whether to stand firm or compromise. I suspect the adjuster might go along with the demand, because of the formula you used.

 

[pb4uski]

I had a fender bender with a Fedex delivery van. They hit my unoccupied vehicle parked in front of my house. The driver knocked on the door to advise. Very minor damage. The claim process is a super PITA. I spoke with 8 individuals including 3rd parties and contractors who all ask the same questions. My truck is only 8 months old so I believe I am entitled to receive a payment for diminished value. Vehicle history will show an accident claim which will reduce resale value. I also need to restore the optional paint sealant that I paid for. The insurance adjuster acknowledges these items but does not seem to know how to file for payment. How is this supposed to work?

I don't understand why diminished value would apply to "very minor damage"... I would think that Fedex would be obligated to restore the vehicle to its previous condition, including restoring the optional paint sealant that you had applied, which they have done by repairing the damage (unclear if the repairs included the paint sealant or not).

If it were a major accident or damaged structural components, then I can see a claim for diminished value, but that doesn't seem to be the case from what you posted.

 

[Koolau]

I don't understand why diminished value would apply to "very minor damage"... I would think that Fedex would be obligated to restore the vehicle to its previous condition, including restoring the optional paint sealant that you had applied, which they have done by repairing the damage (unclear if the repairs included the paint sealant or not).

If it were a major accident or damaged structural components, then I can see a claim for diminished value, but that doesn't seem to be the case from what you posted.

When it comes time to sell, the potential buyer will wave that CarFax report in the seller's face and demand a big discount - that's why.

 

[VanWinkle]

I handled auto and diminished value claims for a National Insurer. Each state has specific laws to govern diminished value calculations and you should be able to access those statutes to get the formula in the state you reside. I agree that they will likely work with you to get it settled, but doing your homework ahead of the negotiations would help.

Good luck,

VW

 

[pb4uski]

When it comes time to sell, the potential buyer will wave that CarFax report in the seller's face and demand a big discount - that's why.

And you tell the buyer to go pound sand.

For a major accident yes, I get it.... but I'm skeptical that it is true for "very minor damage" described by the OP.

 

[Koolau]

And you tell the buyer to go pound sand.

For a major accident yes, I get it.... but I'm skeptical that it is true for "very minor damage" deribed by the OP.

I guess you'll only know when/if it happens to you.

 

[pb4uski]

I'm closing on selling my truck next week and it never came up. In fact, there are a couple dents/dings that I haven't repaired and I pointed them out to the buyer but he offered me my full asking price anyway... no diminished value in this instance.

Also, as a buyer, why would I bother to try to squeeze out a discunt for a very minor damage that has been fully repaired?

 

[Koolau]

Also, as a buyer, why would I bother to try to squeeze out a discunt for a very minot damage that has been fully repaired?

Because you could, I suppose.

 

[pb4uski]

Because you could, I suppose.

Not if the seller tells me to go pound sand and just sells to someone else.

 

[VanWinkle]

This negotiation is between an owner and an insurance company, not a buyer and seller. Insurance companies often pay for things that you would not consider a "claim". 2500 dollars for being involved in an accident with no injuries just to get a release of all claims is an example. It's also why our rates are going up every year along with inflation.

VW

 

[Koolau]

Not if the seller tells me to go pound sand and just sells to someone else.

Yeah, I suppose if the seller gives up on you.



I went through this "issue" with the purchaser of our last home. I could have said "pound sand" but I wanted to sell the house and I wanted to sell it quickly - already had "new" home. On that basis, I was willing to play THEIR silly little game. It "cost" me $1000 less than I wanted to sell for, though, starting over with another buyer would have cost at least 5K in other costs before I arrived at (maybe) the same place. IOW, IF a potential buyer has some leverage over you (as seller) why wouldn't they use it? You as seller can tell them to pound sand and they probably will as they walk away - and you get to start all over again. Sometimes, you just have to accept that the buyer does have that leverage (like in a CarFAx) and let them use it against you - or start over with no more guarantee of success.

Telling someone to pound sand is very enjoyable but not particularly productive when it comes to selling something. YMMV

 

[pb4uski]

It depends on how desperate that you are to sell, but it doesn't really change the dynamic much if the buyer has a CarFax in hand to try to justify a lower price or just wants to press the seller for a better deal.

Also, note that in this case the potential claim for diminished value is a proverbial nit compared to the value of an 8-month old truck and well within what a buyer might press for whether or not they have a CarFax in hand.

 

[jazz4cash]

I don't understand why diminished value would apply to "very minor damage"...

It’s standard practice in the industry.

 

[jazz4cash]

I handled auto and diminished value claims for a National Insurer. Each state has specific laws to govern diminished value calculations and you should be able to access those statutes to get the formula in the state you reside. I agree that they will likely work with you to get it settled, but doing your homework ahead of the negotiations would help.



Good luck,



VW

My state (MD) does not dictate any specific laws. They only say it is available and injured party is responsible for pursuing the claim. When I was doing research I saw several references to Georgia as being “special”

 

[jazz4cash]

I don't have any expertise on Diminished Value. But why not go back to the adjuster and demand that $750? I presume you'd accept an amount somewhere between that and the original offer. In any event, you have a very credible basis for that $750 figure. Your call whether to stand firm or compromise. I suspect the adjuster might go along with the demand, because of the formula you used.

This was my thinking exactly. I countered back at $750 and they said NO.
I dug into the process a bit and realized they did not include the paint sealant repair cost in the damage estimate. Including this cost raises the repair estimate beyond an arbitrary threshold and doubles the value of the claim. This puts it in the ballpark of where I expected to be when I countered. I don’t really expect them to budge, at least not without a fight. I have zero leverage.

 

[pb4uski]

....I don’t really expect them to budge, at least not without a fight. I have zero leverage.

That is what I found out when DS totaled his car and his car insurer, Ohio Mutual, made him a lowball offer for his totaled car. They use a third party pricing service that is approved in the state of NH where he lived and that was the number.

The real problem is that the price was based on private-party value so he could not have reasonably replaced his car with what they offered him from a used car dealer. We agreed on the retail value of the car from a used car dealer, but objected to an obscure adjustment they made to reduce that value to private-party value.

We appealed and even filed a complaint with the NH dept of insurance, but to no avail. When we were close to the point where we would have to start paying for storage of his wrecked car we conceded to their number.

I was more used to the good 'ol days where you could negotiate a claim with an insurer.

The difference wasn't worth going to court over and they knew it.

The only solace that we got was that because we strung the process out so long the pricks had to pay for storage of the wrecked car for much longer than they would have otherwise if they had made us a reasonable offer.

 

[Texas Proud]

This negotiation is between an owner and an insurance company, not a buyer and seller. Insurance companies often pay for things that you would not consider a "claim". 2500 dollars for being involved in an accident with no injuries just to get a release of all claims is an example. It's also why our rates are going up every year along with inflation.

VW

Yea, I totaled my car many years ago... truck turned the corner and I look left and see nobody and turn... right into the back of the truck... it was a BIG truck and I barely felt anything with the hit... but the guy claimed and got about $1500... I insisted to the insurance company there is NO way he had any injury...


As for diminished value... you do have a claim but it is hard to get it... I had a claim for $3000 when car was hit.. major damage to the whole left side... they did not want to pay anything... after a year plus of not getting anywhere I told insurance company I was over waiting and I was going to file against the insured the next week... they split the difference and offered me $1500... I took it...


It is how much you think you can get and what you are willing to do to get it... will you go to small claims for a hundred dollars?

 

[jazz4cash]

It is how much you think you can get and what you are willing to do to get it... will you go to small claims for a hundred dollars?

No. I am more ticked off by their attitude. This really is a nit as PB4 says. Wasting my time and energy.

 

[Texas Proud]

No. I am more ticked off by their attitude. This really is a nit as PB4 says. Wasting my time and energy.

That is what they are supposed to do... make it so hard for some payments that you give up...


Think about it.. how often do you call? How much time are you wasting of theirs? Probably not even close to the $750... so their method is working...


Now, paying a legit claim for the repair is usually not contested as they know they will lose...

 

[Koolau]

It depends on how desperate that you are to sell, but it doesn't really change the dynamic much if the buyer has a CarFax in hand to try to justify a lower price or just wants to press the seller for a better deal.

Also, note that in this case the potential claim for diminished value is a proverbial nit compared to the value of an 8-month old truck and well within what a buyer might press for whether or not they have a CarFax in hand.

Okay, I'll believe it if you will.

 

[Koolau]

It’s standard practice in the industry.

That's what I was thinking as well. But pb4uski assures us it won't have any effect.

 

[Koolau]

That is what they are supposed to do... make it so hard for some payments that you give up...


Think about it.. how often do you call? How much time are you wasting of theirs? Probably not even close to the $750... so their method is working...


Now, paying a legit claim for the repair is usually not contested as they know they will lose...

Sometimes you just gotta play the game - even though you know you're gonna lose. Just like pb4uski suggested: Make it cost them as much as possible - just for the satisfaction. It doesn't put any more money in your pocket, but there's still some aspect of causing them to pay more to someone - even if not you. Sad it has to be this way.

I've always used State Farm which is more expensive, but settlements have just never been an issue. Fair and fast. YMMV