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Diminished value question

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Old 03-05-14, 10:08 PM
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skrules
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Default Diminished value question

Hello guys,

I have a question about insurance claim. My IS350 got rear ended a month ago and the other party's insurance agreed to pay for fixing the damages. So far the bill has run up to 15000 dollars.My insurance company and the other insurance company have sent me an accident report form to be submitted to the DMV.

Since this accident is getting reported to DMV and would show up under vehicle report, while selling the vehicle in the future I may end up losing some money. For this I want to file a diminished value claim with the insurance company. So here is my question. How does this diminished value work?

I talked to the insurance adjuster handling my case and he says diminished values are hard to estimate since they don't know how much the value would diminish if and when I try to sell it. He asked me to send them a letter saying that the value went down and asking for the insurance company to compensate me. But I do not know how much to ask for. Any thoughts? Has anyone been in an situation like this?

Sorry for the long post. I apologize if this is not the right forum.
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Old 03-06-14, 05:19 AM
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I don't have an answer for you but I know this has been discussed before. There have been several IS owners that have been in accidents and this subject has come up. Advance search the forums, you will find something.
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Old 03-06-14, 08:56 AM
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Would an appraisal work? If there really is such a thing. Maybe like Carmax? Someone not involved in the claim to give you an opinion of what they would pay for the car today.
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Old 03-06-14, 09:12 AM
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Originally Posted by moose66 View Post
Would an appraisal work? If there really is such a thing. Maybe like Carmax? Someone not involved in the claim to give you an opinion of what they would pay for the car today.
I was going to suggest getting an appraisal but not at CarMax because they give inflated values.
Take it to a Lexus dealer.
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Old 03-06-14, 10:11 AM
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When calculating the "diminished value" amount I believe it is irrelevant to factor in the future sales price i.e. how much would it cost if I decided to sell it in two years from now vs the same but the clean title car in two years. Since the accident happened currently and the car already has the accident in its records the depreciation amount resulted from the accident should be the number reflected on the check that insurance company should be mailing to you. Start with 40% of current FMV of the clean title car. For example if the clean title car costs $40K the check from insurance company should be $16K only for the diminished value claim since the car depreciated 40% due to the accident. I know it sounds a little too optimistic but it should be used as a starting point.
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Old 03-06-14, 10:20 AM
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Agreed. The diminished value is current, not an issue dependent upon estimating the trade-in/sale value of your car sometime in the future. Diminished value is the difference between the value of your car the minute before you were rear-ended versus the value now with the accident on the car's history. There are experts in diminished value appraisals that can provide you with something in writing. There is a cost involved in obtaining the appriasal, but assuming the diminished value is significant, it is probably a cost worth incurring.
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Old 03-06-14, 10:22 AM
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Originally Posted by Ice350 View Post
I was going to suggest getting an appraisal but not at CarMax because they give inflated values.
Take it to a Lexus dealer.
I looked at other forum post, but I could not find anything related to getting the value that will diminish.
Carmax is a good idea. I will check it out as well.
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Old 03-06-14, 10:24 AM
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Originally Posted by KLMDIS350 View Post
Agreed. The diminished value is current, not an issue dependent upon estimating the trade-in/sale value of your car sometime in the future. Diminished value is the difference between the value of your car the minute before you were rear-ended versus the value now with the accident on the car's history. There are experts in diminished value appraisals that can provide you with something in writing. There is a cost involved in obtaining the appriasal, but assuming the diminished value is significant, it is probably a cost worth incurring.
KLMDIS350 and Salvadorik, thanks for your feedback. I don't mind paying for the appraisal since the car's had to be completely replaced. The current bill is at $15,000 to fix the car. But I just want a starting price to negotiate with the insurance. Do you guys have any idea on where to find these appraisers?
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Old 03-06-14, 10:48 AM
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I looked at some diminished value claim appraisal companies. But I am not sure which one to go with. Some of them look shady as well. Would you guys be able to recommend someone?
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Old 03-06-14, 11:11 AM
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I do not have personal experience with any of the companies, but I would at least do a BBB check. Also, maybe a post to the broader forum for recommendations will yield some results. There must be people in the Lexus community who have worked with some of the diminished value appraisal companies. Good luck, and sorry about the car.
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Old 03-06-14, 02:55 PM
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My car was involved in the an accident the third week after I had gotten it. Diminished value was the first thing on my mind after getting healthy. Said and done, my car took 3.5 months to repair, cost roughly $18-20k in repairs and they cut me a diminished value check of $2962.00. I'm not sure how they got to this figure, but it's about 15% of the damages. I'm sure I could have fought them for a little more, but I figured this was fair and it took no effort other then just simply requesting it. If you're going to keep the car passed the accident, even if it's a lease, definitely demand this. Don't let them try and feed you some bs like they've never heard of it.
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Old 03-06-14, 03:02 PM
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Not a real answer to your question but don't let an adjuster tell you diminished value is not real. As an example, my son had a 6-month old Mercedes ES350 that got just bumped from behind at a stop light and was repaired with all new MB parts for I believe less then $1,000. Not long after that he wanted to trade it for a GS350 and could not even find a Lexus dealer who would consider taking it in because of the Car Fax report. He finally traded it on a Yukon Denali and received a very low trade-in value.

So stay with your diminished value claim.

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Old 03-06-14, 06:50 PM
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I think these stories about cars recording $20k in repair costs are ridiculous. At this point, virtually every car out there is a complete write off. No one in their right mind would buy a car that had a $20 thousand repair bill against it, which is why insurance companies just write them off completely. I don't care if your car had a $50k MSRP, at $20k repair, thats a right off IMO
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Old 03-07-14, 10:05 PM
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Thanks all for the feedback. I am going to get a company to appraise the car and send it over to my insurance company. I will let you guys know how it goes.
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Old 03-19-14, 04:09 PM
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Just wanted to give you guys some updates. I went with this company in Atlanta that has good BBB reviews. I filled out a form and they sent an appraiser to take a look at the car. He came over yesterday, took notes and looked at the repair costs.
Based on his report, I should be getting a report from the company sometime this week or early next week. I will submit that to the insurance company and let you know how that goes. Keeping my fingers crossed.
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