Everyone knows a car will depreciate over time and with accident involvement, the vehicle depreciates just as quickly. How can you minimize vehicle depreciation after an accident? Here are some guidelines that will help you understand what happens with vehicle depreciation.
When you make repairs to a vehicle and there are no signs of damage and once the repair process is over, your vehicle won’t appreciate in value. In fact, its value in retail terms won’t be what it was previously. If you think about hiding any repairs, you’re out of luck there as well as any accidents with your vehicle will show up in a CARFAX report which anyone can access. The average figure for depreciation differs with every vehicle, but after an accident, the depreciation rate is approximately 30%. You say, Wow, but when you drive a car away from a car lot, the vehicle depreciates by double digits (11 percent). So, how do you make up for the loss?
Fix your Vehicle
The first thing you want to do is repair your vehicle soon after an accident. You’ll probably contemplate, I want to find an auto body shop near me where the work can be accurately and professionally done. Even minor work will increase a vehicle’s resale value, so you want to find the best body repair shop to take care of those small damaged areas. When you have the damage repaired, the resale value of your vehicle will increase. In all your vehicle depreciates after an accident.
Use Original Manufactured Parts
When you search for a body shop that will do the work on your car, you’ll want to find one that uses OEM or original manufactured equipment to repair your vehicle. Using parts that are considered aftermarket will lessen the value of your vehicle. Keeping your car as original as possible is important if you want to get the most for its value. Whoever you choose to do the work, be sure and ask them whether they use OEM or aftermarket parts and how the value of your vehicle will be affected.
Diminished Value Insurance Claim
One thing you’ll want to do is file a claim with your insurance company that covers diminished value. If your car has been in an accident, it will lose more of its value. Also, if you did not cause the accident and you’re carrying full coverage, your insurance carrier should compensate you for the diminished value of the vehicle. Contact your insurance company to find out whether you are eligible to file for a diminished value insurance claim.
Diminished Value Types
Diminished value exists because of the results of an accident. If you put your vehicle up for sale after an accident, a diminished value is part of the deal. Even though the car goes through the repair process and is in good condition, it still faces a diminished value or depreciation.
There are different types of diminished value that include:
- Immediate diminished value – This means the difference between your car’s resale value before any accident involvement to after the accident when any repairs are made.
- Inherent diminished value – Once repairs are made after an accident, and the body shop restores the vehicle to pristine condition, you still need to consider that the vehicle was involved in an accident and its value is diminished. When it comes time to sell it or trade it in, the vehicle’s value decreases compared to before the accident.
- Repair-related diminished value – You’re talking about the value lost in a vehicle that is based solely on the quality of the repairs made to it. Say the color of your car is not just the right match or after-market or generic parts were used to repair it. The car will suffer depreciation because of any repairs or equipment used that were less than the highest standard. Your vehicle has a good chance of a certain loss in its value from the repairs made to it.
If you intend to claim diminished value through your insurance company, you’ll want to determine what kind of monetary loss you would deal with because of an accident. When you have an older vehicle that has lost its value, making a claim would probably not be sensible, particularly if a court case and legal fees are in the mix.
Determining Diminished Value
In order to determine diminished value, you can find what the Blue Book value would be normally before an accident. From there, you can deal with a car dealership and ask them for a trade-in value on your vehicle. This figure would give you an idea of its diminished value. It may not be the best offer, but it gives you an understanding of your vehicle’s worth.
You can also verify your vehicle’s worth by evaluating it through a company that deals in diminished value insurance assessments. This option would be the most accurate for a more solid figure of your car’s worth. Just make sure that whoever evaluates your car is a qualified expert and is accepted by your insurance company.
When you have an accident and need repair work done, you’ll want to get the best return on any losses, and Elmer’s Auto Body can help you pave the way through to a more acceptable return. Their auto body technicians provide services that return your vehicle to its original looks while minimizing its depreciation. Call Elmer’s and book an appointment for repairs at (856) 218-0202.