Are you a Maryland motorist? Do you know what the term “diminution in value” means? If not, you may want to make yourself familiar with the term. Otherwise, you could end up losing money in the long run. Here’s a quick overview of the basics:
Diminution in value is a term that is used by both the insurance industry and those working within the Maryland court system. It essentially refers to the post-accident reduction of a car’s resale value. Many people mistakenly assume that it is included in with the insurance adjusters’ appraisal. However, in the majority of instances, it is not. All the insurance adjusters’ appraisal typically takes into account is the amount of money needed to repair the car. Diminution in value, on the other hand, is calculated by looking at the vehicle’s resale market value both before and after the accident as well as the repair appraisal.
For example, let’s pretend that you have a truck with a resale value of $3,000. You get into an accident and the truck sustains $1,000 in damage. Immediately after you repair the truck, you try to sell it for $3,000. However, because it was in the previously mentioned accident, the dealer offers to buy it for $2,000. The $1,000 difference would be considered diminution in value.
Therefore, in the instance of a third-party claim, you could potentially seek to obtain $2,000 in damages from the negligent party and his or her insurance provider. $1,000 would be for the diminution in value and the other $1,000 would be for the repairs. That’s not even taking into account any personal injury related claims that you may have.
In first-party claims, there is also the matter of the Insurance Services Office’s Personal Auto Policy endorsement to consider. It will impact what your legal remedies are as well. Of course dealing with either scenario requires a degree of legal finesse and paperwork.
Given that, if you become involved in a car accident, it is best to contact the law office of Maryland attorney, John Critzos, II for a free consultation. He has experience in handling such issues in Maryland and the District of Columbia. To request a consultation, call 1-301-839-2000 or stop by his website for additional details.
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