Any time you are injured you will undoubtedly end up filing an insurance claim to recover for your physical injuries, medical bills, lost wages, property damage and other losses related to the injury. The insurance companies do not have your financial or physical well-being in mind. They are large, powerful, financially motivated companies who have their own financial interests in mind. Get somebody in your corner with your interests in mind.
The insurance company’s goal in Texas
Their goal is to pay as little as possible on every claim. This isn’t a mysterious conspiracy. Every dollar they pay out on a claim is a dollar of lost profit. To avoid lost profits the insurance companies take steps to tilt claims processing in their favor. They employ claims adjusters who are trained and experienced in processing and settling claims. It’s what they do every day. They have advanced statistical software to evaluate claims. They generally have no duty to be honest with you or negotiate with you in good faith.
Some claims adjusters can be incredibly difficult to work with. Many merely follow orders as trained to do by their employers. The sum of this system is that you are at a distinct disadvantage playing on their home turf. They want to keep you playing on their home turf. That is not in your best interests.
You versus the claims adjuster or your attorney versus the claims adjuster?
Claims adjusters frequently try to dissuade claimants from hiring attorneys. This is because they know if you work with a consumer law attorney you are no longer playing on their home turf. You are not playing by their rules and their expertise and experience are no longer unbalanced. Now they have to deal seriously with the prospect of working with–or against–somebody who presents a credible threat of litigation and understands the fair value of a claim.
Hiring an attorney is not a magic ticket to getting rich on your claim but it is an excellent way to ensure you are fairly negotiating for what you are entitled to recover by law. Falling for the claims adjuster’s promise that the insurance company is dealing with you fairly is not helpful. Even if the claims adjuster really believes they are being fair with you, they are not attorneys and do not have expertise to evaluate the value of a claim in litigation versus pretrial settlement with the insurance company. Nor is the claims adjuster necessarily authorized to give you the maximum value you are entitled to by law.
Diminished Value Claims in Texas
Under Texas law, you have the right to recover for the lost market value to your vehicle related to the accident history when a third party causes damage to your vehicle in a car wreck. This lost market value is known as “diminished value” and you recover for it under a diminished value claim. When another driver causes damage to your car, under normal circumstances, you will file a claim for repairs with the other driver’s insurance company.
Your vehicle is repaired as much as possible. However, when you go to trade in or sell your car potential buyers can see your vehicle has an accident history. Neither individual buyers nor car dealerships will buy a car with an accident in its history at the same price as the same car with no accident in its history, even if the repairs restored the car to the same condition it was pre-accident.
The difference between what the vehicle would have been worth without the accident record and what it can now be sold for with the accident record makes up the amount of a diminished value claim. These claims can be brought with other accident-related claims, such as bodily injury claims, lost wages and other out-of-pocket financial losses due to the accident.
Fighting diminished value claims
Insurance companies do not like diminished value claims and fiercely challenge paying on them. Like bodily injury claims, the insurance adjuster will do everything he or she can to avoid paying on the claim or paying as little as possible. Diminished value claims can be thousands of dollars, sometimes even tens of thousands of dollars, so insurance companies know there is a lot at stake. That gives them a good reason to make it as difficult as possible to fight paying on diminished value claims.
The key to receiving fair value on a diminished value claim is often a strong negotiation position. That may or may not require hiring an attorney. Sometimes insurance claims adjusters will pay on diminished value claims even if you do not have legal representation but often, particularly if your diminished value claim is large, hiring a lawyer experienced with diminished value claims can greatly improve the chance of receiving fair value on the claim.
Evaluating a Diminished Value Claim in Texas
As discussed above, the amount of a diminished value claim is the difference between what the same car would sell for right now with the accident record and without the accident record. This seems like a simple formula but it is actually very open to disagreement. There can be substantial disagreement both on the value of the vehicle without the accident record and then how much less the car would be worth now that it has an accident history. The age, make, model, age, location, mileage, previous accident history, overall condition and demand in the market for that type of car, can all be factors that affect the value of the vehicle itself as well as how much the accident has reduced the value of the vehicle.
Appraisals for diminished value
A quality appraisal of the vehicle can help you assess how much market value the vehicle has lost. There are several ways you can assess the value of the vehicle and obtain appraisals; but not all methods are as effective at determining an accurate value of your diminished value claim nor are they all as effective at persuading the insurance claims adjuster of the true value of your claim. There are many websites and appraisal companies claiming skill in providing diminished value claim appraisals. That is not always the case.
The strongest diminished value claims normally use an appraisal conducted by a qualified person, not a website’s formula. Other processes may be useful as a starting point; but generally not effective in bringing the insurance adjuster to negotiate a fair settlement. Without a quality appraisal your Fort Worth or Dallas lawyer will have a harder time proving lost value.