Adam S. Kutner, Injury Attorneys · Las Vegas Valley
What Is Diminished Value After a Car Accident?
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In This Guide
What Diminished Value Means
Diminished value, also called diminution of value, is the money your car is worth less after a crash than it was worth the moment before, even after every repair is finished perfectly. The bodywork can be flawless and the car still carries an accident on its history report, and buyers pay less for it. In Nevada you can claim that difference from the at-fault driver’s insurer.
Most people find out at trade-in, when the dealer’s number comes in well below what the same car without an accident record would bring. By then the repair check is long since cashed.
The Three Kinds of Diminished Value
The kind that applies to your car changes how the claim is built and what evidence it needs. You will also see the same loss called car accident depreciation or devaluation after an accident; they describe the same thing. The three kinds:
Immediate diminished value
The drop in resale value between the minute before the crash and the minute after, before any repair is done. If the car is sold as-is or never repaired, this is the whole claim.
Inherent diminished value
The loss that survives a perfect repair, purely because the car now has an accident on its record. This is the type most diminished value claims are about.
Repair-related diminished value
The extra loss caused by the repair itself falling short: aftermarket rather than factory parts, mismatched paint, panel gaps, work that was never going to restore the car completely.
How Diminished Value Is Calculated
There are two ways your diminished value gets put into a number, and they rarely land in the same place. The insurer reaches for one because it produces a small figure; a properly built claim uses the other because it reflects what your car is actually worth now.
The number most insurers start from comes from what the industry calls the 17c formula, named for a paragraph in a Georgia court case, not from any Nevada law. It works in three steps, and each step shrinks the result:
Start with your car’s pre-accident market value
You pay nothing upfront. We work on a contingency fee basis, which means our fee is a percentage of what we recover for you, and if there is no recovery, there is no fee.
Apply a damage multiplier
from 0 to 1, meant to scale the loss to how severe the structural damage was. Anything short of major structural damage pulls the number well below the 10 percent cap.
Apply a mileage multiplier
from 0 to 1, which reduces the figure further as the odometer climbs, and can cut it to almost nothing on an older, higher-mileage car.
Because the 10 percent cap and the two multipliers only ever reduce the number, the 17c formula tends to understate the real loss, and an insurer prefers it for that reason. It is a starting position, not the market value of your loss.
The other method is an independent appraisal. A qualified appraiser looks at what your specific car, with its accident now on its history report, will actually sell for against comparable cars that were never wrecked. That real-market difference is usually larger than the 17c number, and it is the figure we build the claim around rather than accepting the insurer’s formula at face value.
How To Prove Your Car’s Diminished Value
You prove what your car lost with before-and-after numbers, so gather more than one source. Two points of Nevada law help you here: you may testify to the value of your own vehicle without hiring an expert, and pricing guides like Kelley Blue Book are admissible evidence rather than something an adjuster can wave away as just a website (NRS 51.245; Dugan v. Gotsopoulos). No single valuation is authoritative, and an insurer will prefer the lowest. We can help you gather:
Pre-accident valuations
from Kelley Blue Book, Edmunds, or NADA for your exact year, trim, mileage, and condition, saved with the date you ran them
A written trade-in or purchase offer
from a dealer, which reflects what the market actually pays rather than what a chart estimates
A professional appraisal
from an independent appraiser, which gives an insurer something harder to argue with where the loss is large
The full repair file
with the estimate, the final invoice, parts documentation, and any supplements, since aftermarket parts are relevant if the repair itself fell short
The vehicle history report
showing how the accident is now recorded, which is the mechanism of the loss
Photographs
of the damage before repair and of any imperfection that remains after
How To Make a Diminished Value Claim in Nevada
You make a diminished value claim in Nevada by raising it separately from the repair claim and supporting it with your own valuation evidence. We handle these key steps for you:
- Work out whose policy pays.
Nevada is an at-fault state, so the at-fault driver’s property damage coverage is the usual source. If that driver had no insurance, Nevada’s uninsured motorist coverage will not help: it covers bodily injury only and does not pay for damage to your car (NRS 690B.020). The first-party coverage that responds to vehicle damage is collision coverage, if you carry it. First-party claims are governed by your policy wording, and many policies limit recovery to repair cost or actual cash value, so read yours before assuming diminished value is covered. - Put the claim in writing, separately.
Diminished value is not part of the repair claim and it is not paid automatically. Say the words, give a number, and attach your evidence. - Send the valuation package, not just an assertion.
Send the pre-accident value, the post-repair value, the difference between them, and the documents behind each. A number without support is the easiest thing in the world for an adjuster to decline. - Expect a low first response.
Expect a denial or an internal formula. No Nevada statute or published decision adopts any particular percentage formula, so an adjuster’s formula is an opening bid, not a legal standard. The same is true of any number you put forward, so support yours with documents. - Escalate if the gap stays wide.
If the insurer will not move, the claim proceeds like any other dispute over whether a policy is being honored fairly, up to and including filing suit.
How Long Do You Have To Claim Diminished Value?
You have three years to claim diminished value from the driver who hit you, because it is a property claim and property runs on a different clock than injury. A claim on your own collision coverage is a different question again: it is a contract claim, and your policy may impose its own deadline for filing suit.
|
Type of Claim |
The Nevada Rule |
Source |
|---|---|---|
|
Vehicle damage, including diminished value, against the at-fault driver or their insurer |
Three years from the crash |
NRS 11.190(3)(c) |
|
Injury to a person |
Two years from the crash |
NRS 11.190(4)(e) |
|
A claim under your own collision coverage |
A contract claim rather than a property claim. Nevada allows six years on a written contract, but a policy can set its own, shorter deadline for filing suit, and that clause controls. Uninsured motorist coverage does not apply here: in Nevada it covers bodily injury, not vehicle damage. |
NRS 11.190(1)(b); NRS 690B.020; your policy |
|
Either claim, if you were partly at fault |
Reduced by your share; barred only if your share was greater than the other driver’s. NRS 41.141 covers injury to property as well as to people. |
NRS 41.141 |
Waiting does not help either way, because evidence of your car’s pre-accident value gets harder to reconstruct as the market moves.
Has an adjuster told you diminished value is not covered?
Call (702) 382-0000 and tell us what your car was worth before the crash and what you are being offered now. The consultation is free and there is no obligation afterward.
When Is It Worth Involving a Lawyer for a Diminished Value Claim?
A diminished value claim is worth bringing to us when the numbers or the circumstances get hard, though not every one needs it. On a modest loss with a cooperative adjuster, a well-documented demand can get paid without help. Call when:
- The loss is large, which tends to mean a newer, low-mileage, or higher-end vehicle where an accident record weighs more heavily on resale
- The insurer has denied diminished value outright or applied a formula it will not explain
- Fault is disputed, since your share of the blame reduces a property claim just as it reduces an injury claim
- You were also hurt, in which case the vehicle claim should be handled alongside the injury claim rather than settled away early
- The repair itself was poor, which turns one claim into two
If you were injured as well as out of pocket on the car, start with our main Las Vegas car accident lawyer page, and see getting your repairs paid for for the rest of the property side.
FAQ About Diminished Value Claims in Las Vegas
Talk to Us About What Your Car Lost
If an insurer is refusing to pay for the value your car lost, or you were hurt in the same crash, tell us what happened. The team at Adam S. Kutner, Injury Attorneys has handled Nevada crash claims for more than 35 years, and the consultation costs nothing.
This article is for general information only and is not legal advice. Reading it does not create an attorney-client relationship. For advice about your specific situation, talk to a qualified Nevada attorney.
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