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What’s the Definition of “Diminished Value” in Florida?
Automobile accidents are no small matter. When you’re involved in a car crash, you’re going to be left dealing with your physical and mental health, of course. How will you pay for your medical care? Is everyone okay? You’re also likely worried about your vehicle. How will you get to work? Will your insurance cover the damages to your car?
A frequently overlooked aspect of receiving compensation following an accident is the diminished value of your car. If you live in the state of Florida, you may be entitled to receive financial compensation to cover the cost of the decline of the market value of your vehicle.
In this guide, we’ll explore what diminishing value claims are, and the FL diminished value definition. Before you settle with an insurance company, read this guide; you may be entitled to more than the insurance companies are offering you.
Florida Automobile Insurance: The Basics
In order to legally register and drive a vehicle in the state of Florida, you’ll need to purchase the appropriate vehicle insurance. This includes both Personal Injury Protection and Property Damage Liability. The minimum you are required to purchase is as follows:
- $10,000 per person, per accident for bodily injury
- $20,000 bodily injury per accident for all people
- $10,000 property damage coverage
- $10,000 personal injury protection
As your insurance agent likely explained to you, there are additional coverages you can obtain. Only you can decide whether options such as collision or comprehensive coverage are right for you. The above listed, however, are required for every vehicle and driver.
Florida is a no-fault state, which means that insurance carriers will presumably pay, regardless of who caused the accident. This, however, only applies to personal injury. Property damage claims can absolutely be made against the driver who caused the accident.
Florida Diminished Value Definition
While it’s possible to file an insurance claim against an at-fault driver for damage to your car, most insurance companies won’t automatically cover the depreciation your vehicle suffers. Let’s look at an example.
Imagine you drive a 2018 Ford. You’ve been considering selling your vehicle, and were recently offered $18,000 for your car. The buyer, however, obtains a copy of your vehicle history report and changes his offer to $14,000 after noting the accident.
While this is a rough example of diminished value, the principle remains. An accident can decrease the value of your car, even if the vehicle is restored to like-new condition.
The Florida diminished value definition refers to the difference between your vehicle’s value before and after an accident. There is a formula used by most insurance carriers to determine this value; we’ll look at that in the next section.
How to Determine Your Car’s Diminished Value
When you file a diminished value claim with an insurance company, they’ll usually use a formula called the 17c formula to ascertain the dollar amount they’re willing to pay. You can follow along with this formula to get a general idea of what you can ask the insurer for.
First, determine the value of your vehicle. This is the resale value, and you can find this in several ways. First, you can simply visit one of several websites online. NADA is the National Automobile Dealers Association, and you can find your car’s value here by inputting certain vehicle characteristics. You can also visit Edmund’s or Kelley Bluebook to get a ballpark estimate on your car’s worth.
If you have a unique car, such as a Tesla or an antique, it may be worth the expense to enlist the assistance of an appraiser. Be sure to obtain a copy of the appraisal in writing; you will need it for the insurance company.
The next steps are relatively straightforward. Your diminished value will be capped at 10% of the value. So, a $20,000 vehicle would be capped at $2,000.
Finally, that “cap” will have two multipliers applied: damage and mileage. Depending upon the extent of the damage to your vehicle and the mileage on the odometer, you’ll multiply that cap by two numbers ranging from 0 to 1. The final result is your estimated diminished value.
A simple Google search will help you determine your specific vehicle’s multipliers, or you may choose to seek assistance from a third party insurance company.
How to File a Diminished Value Claim in Florida
While Florida is a no-fault state, and your insurance company is usually responsible for paying your expenses, the opposite is true for a diminished value claim. To file this claim, you’ll need to contact the other party’s insurance company. They will provide you with the form you need to initiate the action, or some may simply require that you write a written request.
It’s important to remember that insurance companies are big businesses. It's extremely likely that your claim will be denied, or that the insurer will issue a low ball offer. Do your research ahead of calling or sending written notice to the insurer. By doing so, you can be more confident that the offer you receive is a fair one.
As mentioned, we would recommend that you contact experienced professionals prior to getting in touch with an insurance company. In particular, your vehicle appraiser and your attorney will be your allies in the process of filing your claim and receiving the money you deserve.
FAQs
After you’ve been involved in a car accident, it can be difficult to determine next steps. Of course, your health comes first. Take care of your medical needs, and only after you’re on your way to recovery should you worry about the financial aspect of your accident.
We know that you have questions. We’ve put together a list of those questions that are most frequently asked by our clients regarding diminished value claims in the state of Florida.
Is an attorney necessary for a diminished value claim?
No. You do not have to hire an attorney for a diminished value claim. However, it may be in your best interest to schedule a free consultation with a lawyer to discuss your rights. Diminished value claims aren’t always completely straightforward. The nature of your accident, the value of your car and even the make and model of your vehicle can impact the outcome of your case.
We recommend that you schedule a free consultation with an attorney before reaching out to the insurance companies. Experienced lawyers can help direct you to the professionals you need to successfully receive your compensation.
How much will I receive in compensation?
An attorney can not guarantee the outcome of any case. This is especially true with cases such as diminished value claims, where there are many factors in play. The value of your vehicle, the extent of the damage and the nature of your accident are all factors to consider. If you’re interested in pursuing a diminished value claim, consider contacting an experienced attorney to schedule a free consultation.
How long do I have to file my claim?
In the state of Florida, you typically have four years from the date of your crash to file a claim. However, most professionals would agree that the sooner you can file, the better you will likely be. Your medical records will be current and your memory of the accident will be fresh.
Most importantly, however, it’s critical to remember that in a diminished value case you’ll be suing the other driver’s insurance company. The longer you wait, the less likely contact with the other party may become. It’s certainly a worst-case scenario, but the possibility does exist.
Is it worth it to file a diminished value claim?
Diminished value claims are rarely cut and dry. Only you can decide whether it’s worth the time and expense to pursue compensation for the depreciated value of your vehicle.
To best evaluate your own situation, we advise that you first consider the 17c formula. Determine your vehicle’s worth and estimate how much your diminished value claim may be worth. If possible, have a tax assessor or appraiser assist. Then, speak with an attorney and ascertain how much it will cost you to pursue legal action.
No two car accidents are alike. A diminished value claim may be beneficial to you, while the same may not be true for your neighbor with a similar vehicle.
If you’ve been involved in an automobile accident in Florida, don’t accept the insurance company’s offer immediately. First, contact Morgan & Morgan. Our experienced diminished value claim attorneys are ready to assist you in pursuing the money you deserve. Call our office at 888-857-6804 or use our contact form to schedule a free consultation today.
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