– What are you willing to pay for a previosuly damaged car or better yet what if you bought one and it was not disclosed ?
– The value is established by expert opinion in the marketplace and the same place you find out about it when you trade in your car … it is not rocket science.
– In fact a component of “ACV” is the value of a product in the marketplace after defineable use like miles or hours on an engine … these same people and the marketplace establish that very real loss of value.
No, it’s not rated for and shouldn’t be. Diminished value is speculative. If I get my car back repaired and continue to drive it to the point where there is negligable difference in trade in value, why should I collect diminished value. I certainly don’t want to pay higher rates for this contingency.
A better avenue would be to offer optional coverage for diminished value and let people who want it pay for it.
As far as indemnity, most drivers out there don’t have enough liability insurance, and I don’t have enough UM coverage, to fully compensate my family if I’m killed in a car wreck. There are numerous other scenarios where innocent parties are not fully compensated. The system does the best it can, but the principal of indemnity is just that, a principal that cannot be fully realized in every scenario.
Whether “diminished value” is truly an element of auto repairs or not really isn’t the point here. Only one other state has read this coverage into the contract, so it’s hard to say this is a burgeoning legal issue. Instead, what is the contract language? What do the state legislatures require? Shouldn’t this be a matter for individual state insurance departments to deal with? If this coverage is indeed found to be part of the contract, aren’t insurers entitled to rate and collect premium for the additional exposure BEFORE being forced to pay claims? Are class actions truly an efficient way for the marketplace to work? It’s probably much more effective to either lobby for legislation or encourage the marketplace to offer such coverage at an appropriate price.
I detest class action suits where only the attorneys profit. However I am in full agreement that an option, for a charge, should be offered for diminished value.
We keep a vehicle usually 3-4 years and trade off. We always buy and trade the same model and make of vehicle, so we are pretty good at estimating our trade-in value. Our currently vehicle was hit, while parked, and damaged when about 1 year old. Imagine our dismay when we went to trade this one in. They knew it was in an accident and the trade-in value was much less than what we had experienced in the past.
Diminished Value is another invention along with Pain & Suffering. It’s time jury stop rewarding on the bases of Deep Pockets and look at the FACTS and it’s appartent they looked at the FACTS, in this CASE. Thank jurors.
The first question I have when someone makes a claim for “diminished value” is: Is there an actual change in value of the vehile? The customary response is that the trade-in dealer indicates that he has to reduce the trade-in value, due to the fact that the vehicle was involved in an accident, eventhough the vehicle’s body panels were fully replaced and repainted. I suspect that if that same person was going to repurchase his vehicle from the dealer the week after he traded it in, he will see that vehicle on the lot listed for the same price as other similar model vehicles with the same mileage, without a discount for the fact that it was previously involved in an accident.
Secondly, I would say that “diminished value” can only be measured at the time the repaired vehicle is actually sold by the owner. If a carrier pays diminished value today to the owner, but the owner does not actually sell the vehicle until 7 years from now, the owner actually profits, because who cares that a vehicle was struck 7 yrs. ago (law of diminishing returns or accelerated depreciation).
My first thought after reading this article is that isn’t it the insurance companies responsbility to indemnify. Well, if your veh is worth less after repairs due to diminished value, then they have not indemnified you.
With years in the auto repair industry and insurance industry(25yrs autobody repairman and 8yrs Allstate agent}, experience taught me that the repairs to a vehicle, if done properly with OEM parts and the amount of damages is a small percentage of the vehicles value, the vehicles value will not depreciate much at all. The use of pro shops by insurers is the only reason that I would agree with diminished values. Most of their pro shops do not do excellent work. One must also include that the vehicle operator bears a certain amount of resposibilty for negligence. Diminished value does not pertain to liabilty losses, only collision losses. Once upon a time I believed that claim losses were what caused rate increases, butttt, now I fully believe that premiums are a product of investor greed(Stock holder Dividends).
One opinion, from an ex autobody man and ex Allstate agent.. OMP
The purpose of class actions is to allow the little man to have a voice where they normally wouldn’t. An individual simply can’t take on the industry practices issue with a simple DV claim. It’s not cost effective as expenses to bring such a case are a hundred fold more expensive as the damages.
Class actions make it possible for the public to force corporations to change their practices where they can’t individually. I understand you focusing on the short term gain of the lawyers but you are forgetting the long term benefits consumers reap from the work the attorneys do. Don’t get caught up in the tort reform hype on class actions!
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EJ:
– What are you willing to pay for a previosuly damaged car or better yet what if you bought one and it was not disclosed ?
– The value is established by expert opinion in the marketplace and the same place you find out about it when you trade in your car … it is not rocket science.
– In fact a component of “ACV” is the value of a product in the marketplace after defineable use like miles or hours on an engine … these same people and the marketplace establish that very real loss of value.
No, it’s not rated for and shouldn’t be. Diminished value is speculative. If I get my car back repaired and continue to drive it to the point where there is negligable difference in trade in value, why should I collect diminished value. I certainly don’t want to pay higher rates for this contingency.
A better avenue would be to offer optional coverage for diminished value and let people who want it pay for it.
As far as indemnity, most drivers out there don’t have enough liability insurance, and I don’t have enough UM coverage, to fully compensate my family if I’m killed in a car wreck. There are numerous other scenarios where innocent parties are not fully compensated. The system does the best it can, but the principal of indemnity is just that, a principal that cannot be fully realized in every scenario.
Whether “diminished value” is truly an element of auto repairs or not really isn’t the point here. Only one other state has read this coverage into the contract, so it’s hard to say this is a burgeoning legal issue. Instead, what is the contract language? What do the state legislatures require? Shouldn’t this be a matter for individual state insurance departments to deal with? If this coverage is indeed found to be part of the contract, aren’t insurers entitled to rate and collect premium for the additional exposure BEFORE being forced to pay claims? Are class actions truly an efficient way for the marketplace to work? It’s probably much more effective to either lobby for legislation or encourage the marketplace to offer such coverage at an appropriate price.
I detest class action suits where only the attorneys profit. However I am in full agreement that an option, for a charge, should be offered for diminished value.
We keep a vehicle usually 3-4 years and trade off. We always buy and trade the same model and make of vehicle, so we are pretty good at estimating our trade-in value. Our currently vehicle was hit, while parked, and damaged when about 1 year old. Imagine our dismay when we went to trade this one in. They knew it was in an accident and the trade-in value was much less than what we had experienced in the past.
Guess we will keep this one for a few years…….
Diminished Value is another invention along with Pain & Suffering. It’s time jury stop rewarding on the bases of Deep Pockets and look at the FACTS and it’s appartent they looked at the FACTS, in this CASE. Thank jurors.
The first question I have when someone makes a claim for “diminished value” is: Is there an actual change in value of the vehile? The customary response is that the trade-in dealer indicates that he has to reduce the trade-in value, due to the fact that the vehicle was involved in an accident, eventhough the vehicle’s body panels were fully replaced and repainted. I suspect that if that same person was going to repurchase his vehicle from the dealer the week after he traded it in, he will see that vehicle on the lot listed for the same price as other similar model vehicles with the same mileage, without a discount for the fact that it was previously involved in an accident.
Secondly, I would say that “diminished value” can only be measured at the time the repaired vehicle is actually sold by the owner. If a carrier pays diminished value today to the owner, but the owner does not actually sell the vehicle until 7 years from now, the owner actually profits, because who cares that a vehicle was struck 7 yrs. ago (law of diminishing returns or accelerated depreciation).
My first thought after reading this article is that isn’t it the insurance companies responsbility to indemnify. Well, if your veh is worth less after repairs due to diminished value, then they have not indemnified you.
well, i guess the plaintiff attorneys suffered diminished value. atta boy Allstate!
With years in the auto repair industry and insurance industry(25yrs autobody repairman and 8yrs Allstate agent}, experience taught me that the repairs to a vehicle, if done properly with OEM parts and the amount of damages is a small percentage of the vehicles value, the vehicles value will not depreciate much at all. The use of pro shops by insurers is the only reason that I would agree with diminished values. Most of their pro shops do not do excellent work. One must also include that the vehicle operator bears a certain amount of resposibilty for negligence. Diminished value does not pertain to liabilty losses, only collision losses. Once upon a time I believed that claim losses were what caused rate increases, butttt, now I fully believe that premiums are a product of investor greed(Stock holder Dividends).
One opinion, from an ex autobody man and ex Allstate agent.. OMP
The purpose of class actions is to allow the little man to have a voice where they normally wouldn’t. An individual simply can’t take on the industry practices issue with a simple DV claim. It’s not cost effective as expenses to bring such a case are a hundred fold more expensive as the damages.
Class actions make it possible for the public to force corporations to change their practices where they can’t individually. I understand you focusing on the short term gain of the lawyers but you are forgetting the long term benefits consumers reap from the work the attorneys do. Don’t get caught up in the tort reform hype on class actions!
RFW