Diminished Value is the automatic loss in the vehicle market value from an accident and repair. Diminished value is based on public awareness that even if a vehicle is repaired to the best of human ability, it will still exhibit remaining deficiencies and inconsistencies from the pre-loss condition of the vehicle.
Deficiencies include, but are not limited to the following:
Weaker structural components that appear cosmetically sound
Impossible to duplicate factory seams, sealers, and finishes
Telltale signs of repair, such as paint missing off the heads of bolts
The unavailability of some factory decals, and markings
Undiscovered Kinetic damage throughout the vehicle
The increased likelihood of a mechanical failure
The effect that the repair will have on the future deployment of the SRS systems
The impossibility of duplicating immersion rust-proofing techniques, etc.
This loss is based on remaining flaws, defects, and damage, which the insurer had neglected to address. When an insurer negotiates the settlement of an automobile damage claim, they will typically provide an estimate of repairs, which outlines all specific procedures, parts, and materials that they are willing to pay to the claimant or insured. This itemized listing of insurer authorized repairs will be generated by one of the following entities:
An “in-house” appraiser, who is hired as a full time employee of the insurer, then trained to assess collision damage in accordance with policy provisions.
An “independent” appraiser who is hired as a subcontractor to assess the damage on behalf of the insurer, who also follows insurer guidelines.
An employee of a “Direct Repair” body shop, who agrees to prepare the assessments using the guidelines established by the insurer in exchange for consumer referrals from the insurer.
In some cases, the insurer will offer to pay based on the lowest of three estimates. This will cause the level of compensation to be based upon the estimator with the least experience, inspecting the vehicle for the shortest time, using the poorest repair techniques, and potentially overlooking the most damage.
Repair Related Diminished Value is based on remaining flaws and defects caused by improper repairs for which the shop had been asked, and paid, to complete. Poor repairs would cause the vehicle to be valued less than a properly repaired vehicle.
A few examples of repair related flaws and defects are as follows:
Poor structural, and cosmetic welds
Frame repair listed on the insurance estimate, but not completed properly
Inferior repairs on straightened panels
Miss-matched color paint after “blending” had been paid
Sanding scratches on moldings, glass, and trim
A total loss occurs when your car is damaged badly enough in a crash that it would cost more to repair the car than it would to replace it. At this point the insurance company is essentially buying it from you for the actual cash value (ACV) of your vehicle. To verify the AVC of your vehicle, the insurance company is required to provide you with an appraisal report or a market valuation. Insurance companies generally utilize an outside company (Mitchell, CCC or Audatex) to compile the data and issue an appraisal report. If you believe that the insurer’s assessment is wrong or unfair you have the right to challenge their ACV. You achieve this by hiring your own independent auto appraiser to produce a counter-valuation, basically a second opinion in the form of an appraisal report. This is where Collision Safety Consultants comes in. We prepare our own appraisal report to verify the validity of the insurance company report. Generally, the insurance company report is very conservative. More times than not, our report results in a higher ACV payout.
