Diminished Value
Claims for Motor Vehicles Involved in a Car Wreck
Craig Hardegree, Esq.
As a general rule, females are much more
apt to seek medical treatment for injuries sustained in an
auto accident than are their male counterparts. This may
stem from the male machismo which some men feel is
diminished by admitting to being injured. But mostly, this
has something to do with the fact that men usually have a
much greater attachment to their vehicles than do women.
After an auto accident, many men are far more concerned
with getting their vehicles fixed than they are with
getting their selves “fixed”.
When dealing with damage to your vehicle following an auto
accident, an issue which often arises is that of
“diminished value”. If you have ever traded in a vehicle,
you know a substantial loss is taken if the trade-in has
ever been wrecked, regardless of how expertly it may have
been repaired. This is the basis for seeking additional
compensation for the diminished value of a wrecked
vehicle, over and above the actual cost of repairs.
However, whether or not you are legally entitled to
diminished value damages, depends on whose company is
paying for your repairs.
While it may seem backwards, if the at-fault party’s
insurance company is paying for your repairs, you may not
be able to collect for the diminished value; whereas, if
your own company is paying for the repairs, you probably
are entitled to collect the additional diminished value
damages. The difference lies in the distinction between a
tort claim and a contract claim.
When an accident is the fault of the other driver, that
at-fault driver has committed a “tort” or a “private
wrong” against you. Your legal recourse in such a
situation is to bring a claim against that person, not
against that person’s insurance company. True enough it is
that person’s insurance company which will handle the
claim and eventually pay the claim but, technically, your
claim is not against his insurance company, it is a tort
claim against him. Because of this, there are no black and
white rules about what “he” (really his insurance company)
has to pay you. The only thing he has to pay is what a
jury tells him to pay, if the case goes that far. Short of
actually going to court (and few vehicle claims ever make
it that far) the amount which he has to pay for the
damages to your vehicle is based purely on negotiations,
which in turn are based on what each side believes a jury
would award, if the case went that far. For this reason,
you may or may not get the additional diminished value
damages when dealing with the other person’s insurance
company.
The issue is completely different when your own company is
paying for the repairs. Since it is your own company, you
have a contract with them, also known as your “policy”. In
this contract, you have agreed to pay certain premiums and
in exchange, your insurance company has agreed to pay your
damages according to the terms of the insurance policy.
Georgia courts have usually interpreted insurance policy
language (relating to vehicle damage) to mean that a
person has a contractual right to be made “whole”, with
the measure of damages being based on the vehicle’s value,
rather than just on the repair cost. The example often
used relates to a vintage bottle of wine. If it is dropped
and broken, fresh grapes and a new glass bottle may
“repair” the bottle of wine, but they certainly won’t
replace the lost value of the wine, regardless of how
expertly the “repairs” are made. Therefore, because of
your contract (policy), you usually can seek diminished
value damages to your vehicle when your own company is
footing the repair bill.
Generally, you will be dealing with your own company when
you have a one-car accident (such as running out of the
road or hitting a deer) or when you are in an accident
that is your fault. You are usually dealing with the other
driver’s company when the other driver is at fault,
although you can opt for your own company to fix your
vehicle even in that situation if you have collision
coverage. However, most people forego this option, partly
out of a sense of loyalty to their own company, but mostly
to avoid the deductible.
If you have been
involved in a car wreck, auto accident, truck collision, motor
vehicle crash or any other personal injury case and you live in
the cities of
Carrollton, Bremen, Bowdon, Villa Rica, Temple, Hiram, Dallas,
Douglasville or in Carroll County or Douglas County or in the
Counties of
Haralson, Paulding or Clayton, please
contact
our Personal Injury Law Center for a free consultation
with a personal injury lawyer.
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