Posted on November 20th, 2025

A Step-by-Step Guide to Recovering Diminished Value After a Car Accident

If your vehicle has been involved in an accident, even after repairs, its market value may decrease. This loss in value is known as "diminished value." Filing a claim for diminished value helps you recover the difference between your car’s value before the accident and its value after repairs. This guide explains the process for filing a diminished value claim in the United States.

1. Understand Diminished Value

Diminished value refers to the loss in your vehicle’s market value following an accident and subsequent repairs. Even if your car is fully restored, its history of damage means buyers may not pay as much as they would for an undamaged vehicle.

2. Determine Eligibility

• Your vehicle was damaged in an accident that was not your fault.
• You have proof that your car has been repaired.
• The at-fault party’s insurance is responsible for the damage.
• Your state allows diminished value claims (laws vary by state).

3. Gather Documentation

• A copy of the police report or accident report.
• Photos of your vehicle before and after repairs. (Helpful but not needed)
• Repair invoices and receipts. (Final Repair Estimate)
• Proof of ownership (car title, registration). (Helpful but not needed)
• Estimates of your car’s value before and after the accident (from Collision Consultants of North America).

4. Obtain a Diminished Value Appraisal

Hire a professional appraiser (Collision Consultants of North America) to estimate how much your vehicle’s value has declined due to the accident. An independent appraisal can strengthen your claim. Insurance Companies will offer very little if any.

5. File Your Claim

1. Contact the At-Fault Party’s Insurance Company: Notify them that you intend to file a diminished value claim.
2. Submit Documentation: Provide all gathered documents, including the diminished value appraisal.
3. Complete Required Forms: Fill out any necessary claim forms as instructed by the insurer.

6. Negotiate the Settlement

Insurance companies may initially offer a lower amount or deny the claim. Be prepared to negotiate. Present your evidence, including the appraisal, and calmly explain your position. If you feel the offer is too low, you can:

• Request a written explanation for the offer.
• Present competing appraisals.
• Seek legal advice if necessary.

7. Final Steps

• If you reach an agreement, ensure you receive the settlement in writing.
• If your claim is denied, request the denial in writing and review your options for appeal or legal action.

Tips for a Successful Diminished Value Claim

• Act promptly—many states have deadlines for filing claims.
• Be persistent and organized in your communications.
• Consider consulting an attorney if your claim is complex or involves a significant amount.

Conclusion

Filing a diminished value claim can help you recover losses after a car accident. By understanding the process, gathering strong evidence, and negotiating effectively, you can improve your chances of a fair settlement. Always check your state’s regulations for specific requirements.