If your car is worth less after it is repaired than it was worth before it was damaged, you can make a claim for its diminished value ("DV"). This claim is based on the common sense notion that a purchaser will not pay as much for a car that has had substantial damage --  even if it has been repaired --  than  they would pay  for a similar vehicle that has not had substantial damage. That's why this claim is sometimes called a "diminished resale value" claim. After a routine collision, you probably won't have a DV claim.

To have a DV claim, your car must have been substantially damaged, have no history of significant collision damage and, probably, be a newer car. In most states, you can recover the diminished value of your car from the insurance company  of the driver who caused your accident. There are only a few states in which you can make a DV claim against your own insurance company. Those states are Georgia, North Carolina and Kansas.

Technically, there are 3 kinds of diminished value.

• Inherent Diminished Value is the reduction in value that results from your vehicle having significant damage, even if the repairs were done well.
• Insurance-Related Diminished Value means that the insurance company that paid to repair your vehicle used inferior parts and procedures, resulting in your vehicle losing value when compared to other cars that don't suffer from those problems.
• Repair-Related Diminished Value occurs when the repair shop fails to do the repairs correctly.

To be able to collect for a DV claim, you will need a diminished value report from an expert. There may be such an expert in your area, or you can locate one online. Letters from used car dealers are not usually enough.

Learn more about Who Pays for Car Damage After an Accident.