According to the National Highway Traffic Safety Administration, a motor vehicle collision happens every ten seconds in the United States. This amounts to a decent amount of bodily harm—and just as much personal property damage. However, most drivers are unaware that the financial consequences of an automobile accident can last long after your car is brought to the mechanic shop, and the repairs are made. Once your car has been in an accident, no matter how small or seemingly inconsequential, it is permanently diminished in value.

Since many states require full disclosure of all accidents in which a vehicle may have been involved, the diminished value will become apparent in the selling or trading of your vehicle. Any car that suffers damage structurally or cosmetically (and oftentimes, both) during an accident experiences diminished value. Even if the car is restored to immaculate condition afterwards, the fact remains that it was worth more money prior to your automobile accident. As most buyers prefer cars that have not been involved in an auto crashes, it makes sense that your vehicle is now worth less money in comparison to a car that has not been involved in an accident.

Keep in mind that every vehicle’s diminished value will vary, making a systematic calculation of your car’s worth after an accident rather tricky to the inexperienced individual. Since the majority of auto crash victims have little to no experience in handling diminished value claims, insurance companies tend to have a leg-up in the process and will often take every possible route to avoid giving you a fair cut.

However, this shouldn’t discourage you from making a diminished value claim in Louisiana after your automobile accident. In fact, there is a state statute that allows car owners to recover the diminished value of their vehicle after an accident caused by an outside party’s negligence. Remember, there will be several factors that will affect the calculation of your vehicle’s diminished value, including:

  • The vehicle’s condition prior to the accident
  • The undamaged car’s value 
  • The age and mileage of the car
  • Any prior accidents that have occurred 
  • Marketplace demand for your vehicle’s model

Diminished value claims have been paid out in every state, including Louisiana, by every major insurance company. There are two different types of diminished value claims, however: first-party and third-party insurance claims. First-party insurance claims occur when an individual damages their own car and has their insurance company pays the claim. Third-party claims, on the other hand, transpires when a negligent driver damages another party’s car, and their insurance company pays the claim. Even if the opposing party does not carry a current insurance policy, which amounts to a hefty 13 percent of Louisiana drivers, those with uninsured motorist coverage on their policy can file a diminished value claim under their own insurance.

If you or someone you know has been the victim of an automobile accident and is considering filing a diminished value claim, contact Bush Law Firm for a quick, easy consultation. You never know—you may have a valid claim on your hands that entitles you to compensation, and no other local Gonzales law firm can navigate the world of insurance claims better than us!


Richard Brooks

Paralegal, Bush Law Firm