Factors That Will Affect the Diminished Value of Car
It is good to note that diminished value claims allow people to recover the lost market value of a car that has ever had an accident in their usage and these claims normally have no precise process of determining the market value that has been lost when the car was involved in an accident. Some states like Texas allow people to recover their cars under the diminished value chain and the possibility if someone can get a diminished value claim and how much they can get from the insurance company depends on many factors such as: the value of the vehicle before the accident, the market value of that type of vehicle and how good the client or the attorney can negotiate with the insurance firm.
How old the vehicle is determines the diminished value cost because every car has market value but older cars can be sold at literally any price and most insurance companies will use any possible way to reduce and even avoid paying out a diminished value claim for a car that is seven years or more years old. From the economic viewpoint of the insurance company the diminished value of an old vehicle is always less than the price of a new car and in most cases insurance companies assume that it is not worth much to make a claim for the financial payments that are claimed on the car.
Another issue to look into is the mileage of the car and even when buying cars mileage is a key contributor and most people prefer a car with a low mileage because the lower the mileage, the less wear and tear and the higher the frequency of repairs in the future and as such the mileage will also affect the diminished value of the car. When it comes to insurance companies the aspect of mileage is discussed in a confusing manner because a car that has a high mileage and has an excellent service record is worth much more than a car that has the same mileage and a poor service record will command a lower value of diminished value and there is also the fact that some particular car brands can stand the test of mileage and these factors can significantly affect the negotiation points.
It is good to note that the make and model of the car also affects the diminished value because some brands are automatically more expensive than other brands and as a result a car that began as an expensive model will also have a higher diminished value and for a car that started at a lower price point it will also command less diminished value.