How do I submit a diminished value claim to an insurance company?
Detailed Answer
North Carolina law lets you recover the loss in market value your vehicle suffers after a collision, even after quality repairs. This loss is called “diminished value.” Below is a step-by-step guide, using an example where Alice is rear-ended at a red light in Durham and her two-year-old SUV needs a new bumper and frame straightening. Alice wants the at-fault driver’s insurer to pay for her car’s diminished value.
1. Confirm Eligibility
Liability: The other driver must be at least partly at fault. North Carolina’s N.C. Gen. Stat. § 20-279.21 requires liability policies to cover “property damage,” which courts interpret to include diminished value.
No contributory negligence: If you were even 1% at fault, the insurer may deny all recovery under the state’s strict contributory-negligence rule.
2. Gather Proof of Loss
Repair records: Final invoice, parts list, and photos.
Vehicle history: Pre-crash mileage, options, prior accidents, and clean title.
Professional appraisal: A qualified independent appraiser compares pre-crash retail value with post-repair value. In Alice’s case, the appraiser documents a $3,800 loss.
Comparable listings: Ads showing that similar cars with accident histories sell for less.
3. Notify the Insurer in Writing
Send a certified-mail demand letter to the adjuster that includes:
Your name, claim number, and date of loss.
Statement of liability (police report reference).
Amount claimed (e.g., “I seek $3,800 for inherent diminished value”).
Counteroffer (often using a lower in-house evaluation tool).
Request inspection by their appraiser.
Compare methodologies and request written justification for any lower figure. Many claims resolve between the two numbers.
5. Preserve Your Rights if Talks Stall
Department of Insurance Complaint: File online if the carrier delays or refuses a good-faith offer.
Small-Claims Court: Sue for up to $10,000 in magistrate court (see N.C. Gen. Stat. §§ 7A-210 et seq.). You must prove pre- and post-repair value through testimony or appraiser affidavit.
District Court: For larger losses or combined personal-injury claims, file within the three-year statute of limitations for property damage (§ 1-52).
6. Collect Payment and Sign Release
Once you agree on a number, the insurer will send a release. Read carefully—sign only if it resolves property damage claims only, not your injury claim unless you intend to settle both.
Helpful Hints
Ask for the insurer’s diminished-value worksheet early; spotting errors strengthens negotiation.
Late-model, low-mileage, and luxury vehicles usually show the highest diminished value.
Keep communications professional and in writing; adjusters log every call.
An appraisal that includes photographs, NADA or Kelley Blue Book data, and comparable-sales analysis carries more weight.
North Carolina does not require you to use your own collision coverage first; you may claim directly against the at-fault carrier.
The diminished-value check should be made payable to you—not the body shop or lienholder.
Don’t let the insurance company undervalue your loss. If you are unsure how to prove diminished value or the adjuster refuses to pay, our firm’s attorneys handle these cases every day. Call us now at 919-313-2737 for a free consultation and let us fight for the full value you deserve.
