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How We Handle Diminished Value Claims in Texas

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Texas is a diminished value state, meaning drivers may be entitled to compensation if their vehicle loses market value after an accident—even after quality repairs. Understanding how diminished value claims work can help you recover the financial loss tied to your vehicle’s reduced resale value.

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What is Diminished Value?

Diminished value refers to the decrease in a vehicle’s market value following an accident, regardless of how well the vehicle has been repaired. Even with flawless repairs, the accident history remains on the vehicle report, which can significantly impact its resale or trade-in value.

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Types of Diminished Value​

There are three primary types of diminished value claims recognized in Texas:

1. Repair-Related Diminished Value
   This occurs when post-accident repairs are substandard or incomplete, reducing the vehicle’s overall value.

2. Immediate Diminished Value
   This represents the difference in value between the vehicle’s pre-accident state and its value immediately after the accident, before any repairs. It can also reflect loss caused by the insurance company’s involvement if repairs are delayed or not fully covered.

3. Inherent Diminished Value
   The most commonly recognized type, inherent diminished value is the loss in market value simply because the vehicle now has an accident history—regardless of repair quality.​

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Eligibility to File a Diminished Value Claim in Texas

Yes, Texas permits diminished value claims, but certain criteria must be met:

• Statute of Limitations: Claims must be filed within two years of the accident.

• Fault: You cannot file if you were at fault for the accident.

• Collision-Only Damage: The loss must be due to a collision, not other causes.

• Proof of Value Loss: You must demonstrate that your vehicle has decreased in value due to the accident.

• Uninsured Motorist Coverage: If the at-fault driver is uninsured, you may still file a claim under your uninsured motorist coverage.

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Calculating Diminished Value

Although you can estimate diminished value independently, consulting a qualified professional often provides a more accurate and credible assessment. Calculations consider:

• Extent and nature of damage

• Quality and cost of repairs

• Vehicle make, model, and age

• Current market conditions

• Mileage and accident history

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The 17c Formula

Insurance companies frequently use the 17c formula, though it may undervalue the claim. The formula includes:

1. Determine Pre-Accident Value – Start with the vehicle’s fair market value prior to the accident.

2. Base Loss Calculation – Multiply that value by 10% to estimate initial loss.

3. Damage Multiplier – Adjust for the severity of the damage using a scale from 0.0 to 1.0.

4. Mileage Multiplier – Further adjust based on the vehicle’s mileage, decreasing the value for higher mileage vehicles.

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Filing a Diminished Value Claim

To submit a successful claim:

• Specify that you're filing for diminished value as part of your property damage claim.

• Provide documentation showing reduced value, including repair estimates, receipts, and third-party appraisals.

• Confirm that the applicable insurance policy includes diminished value coverage.

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Negotiating Your Claim

Insurance providers may attempt to settle for less than your claim is worth. Working with an experienced professional helps you present a well-supported claim and negotiate a fair settlement.

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Why Choose My Car Claim Experts?

At My Car Claim Experts, we specialize in navigating the complexities of diminished value claims across Texas, particularly in the Dallas area. Our team is dedicated to securing the compensation you deserve, managing every aspect of the claims process on your behalf.

Contact My Car Claim Experts today to schedule a consultation and receive the expert support you need to maximize your diminished value recovery.

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