Advice Before Starting On Diminished Value Claim

Hi all,

I don't have insurance through Farmers Insurance, but was stuck in the rear by someone who does last year.

I went through all the proper channels at HelpPoint Claim services and they seemed to be very helpful with everything needed. I used a dealership body shop that was in their recommended network and had my vehicle repaired to a somewhat satisfactory state. I mean, it's not 100% like it was when it rolled off the assembly line, but I'm not complaining.

However, I was made aware of the diminished value conundrum (via the very friendly and helpful body shop representative, thankfully), in being that my vehicle probably lost quite a bit of it's resale value and that this is something I can and should be compensated for. After all, the accident wasn't even my fault!

I've considered that my vehicle isn't a high dollar Mercedes like some of the others I've read stories of on here, and I probably am not looking at a large amount of compensation, but either way you look at it, small sedan or no small sedan — whatever the value — my vehicle was struck by someone else, and the resulting diminished value should not be pushed under the rug.

So... I reached out to Farmer's inquiring about the diminished value claim (since they sure as heck don't mention it to you at all) and they sent me over some forms to fill out. This is currently where we stand...

My post here arises from some of the questions on the forms and not knowing exactly how to proceed. For instance, they are asking a whole lot about any previous accident history, saying I am required to provide detailed explanations, body shop repair receipts, etc. etc. and that this will play a role in their investigation and the amount decided upon. I can provide scans of these forms, if anyone wants to see them.

Anyway, I'm confused on this a bit. Logically, it would be my understanding that they investigate all these things on their own, right? Seems to me I'm doing their homework for them? Or, is it better to fully research and provide them everything they are asking as to not let them come to a lowball decision on their own, giving little-to-nothing as compensation?

There is definitely a catch in regards to these questions, which is another reason I'm so reluctant to answer them so quickly... I do actually have a couple minor fender benders in my claim history that were a couple years ago.

One, barely scratched my vehicle at all, but more damaged the other vehicle. If I recall correctly, I didn't take any money for my own repairs. All claims were on their side.

Another, I became victim of an insidious pothole and the bottom corner of my fender was nicked a little as well as a blown out tire and wheel alignment. The claim resulted in being filed as an at-fault moving accident, even though I didn't perceive it that way. Yeah, I used the money to fix everything, but I don't seem to have receipts for all of it, as it wasn't all repaired at the same place, so I'm not sure I could even answer the questions surrounding that one accurately.

Anyone have any advice they'd like to share?

Diminished Value is a hot button issue with Farmers right now. They are keeping it quiet and don't want to talk about it because Leadership is concerned about setting precedents in states that have ambiguous or no DV language. People are becoming more aware of DV and, as you might expect, cases are being decided and setting those precedents in some states. My advice, check with your state's Department of Insurance to determine what DV is or is not in your state. Do not rely on Farmers to help you in this area. They will not pay it if they arent bound to it.

If only it were as simple as hiring a licensed appraiser and submitting their automobile diminished value report to the insurance company. When prospective clients call us with questions, after they hear the answers, most of them disappear - never to be heard from again. St Lucie Appraisal prepares the best auto diminished value appraisal that can be obtained in any of the 50 states. We hate to turn away business but the cold hard truth is, regardless of the fact that you'll be submitting irrefutable evidence of how much value your car has lost after collision repairs, companies like Farmers will still offer settlements representing a fraction the actual diminished value. Where do these people vanish to? Perhaps other independent appraisal companies promise huge settlements or maybe people become frustrated and meekly accept these lowball payouts but being dishonest about our customers' prospects is no way to do business. A more reasonable reality is that you'll need to make a formal complaint to your state's insurance department for unfair claims practices and, perhaps, go so far as hiring an attorney. But in the event your complaint escalates into a courtroom battle, you'll be asking for compensation for appraisal and attorney fees on top of your diminished value and there's a good chance you'll win! Why? Read on.

The automobile diminished value report you receive from St. Lucie Appraisal is based entirely on the opinions of used car managers at automobile dealerships. Was your Honda wrecked and repaired? Our report provides six quotes from Honda dealerships that specifically address your actual vehicle and the exact amount and severity of damage that was repaired. When people trade their cars in, those are the guys who buy them so their opinions are valid. Other appraisal companies providing diminished value reports may use formulas such as the inappropriate (as ruled by The Georgia Supreme Court) Rule 17-C or collect data from auto auctions to formulate their figures. I'm not guaranteeing success if you march into court with this type of appraisal. Insurers can successfully argue that they do not address your specific car or the damages it incurred.

The Georgia Supreme Court's ruling on the inequity of Rule 17-C laid the foundation for fair automobile diminished value settlements in all 50 states. Formulas such as State Farm's Rule 17-C severely shortchanged vehicle owners and, in doing so, provided themselves and other insurers using formulas to determine diminished value with unjust enrichment.

Subsequent to your accident, the adjuster from the responsible driver's insurance company will offer you a settlement for diminished value. If you ask them how they came up with the figure they will either point to a formula, a "certified" appraiser's report or simply refuse to explain their process altogether. I have seen the diminished value reports prepared by independent appraisers hired by insurers and they are a joke. They contain no reasonable facts to back up their assumptions. Most of them are not licensed in any state. Note that "certified" appraisers belong to pay-to-be-certified organizations, not unlike the Better Business Bureau and should not be confused with "licensed" appraisers. A number of insurance company attorneys have contacted St. Lucie Appraisal in the past to inquire about hiring us. Once they learned about our process of using dealer quotes, however, their interest faded quickly as they realized that our reports would result in higher (translation: fair) diminished value settlements. In front of a magistrate or mediator, these types of reports provide actual evidence of how much less your car is worth in the real world. Appraisals based on formulas or auction results can not compare. And insurance company diminished value estimates made up out of thin air (yes, they do exist) will certainly be looked upon as unfair at best and possibly fraudulent in the eyes of a judge.

Face it, even your own insurance agent or broker hasn't informed you of your right to collect diminished value from the insurer of the responsible driver. Regardless of the fact that the settlement isn't even costing your own insurer a dime, agents are mum on the subject altogether. Automobile diminished value is the newest thorn in the insurance companies' side. Their mission is to keep it a secret and their hope is that it will go away.