Diminished Value Claims (2026)

Diminished value (DV) claims recover the loss of your vehicle’s market value after it has been repaired following an accident.

Diminished value claims often range from $500 to $5,000, depending on vehicle value, mileage, and damage severity. Insurers commonly use a 10% base formula, while state insurance law determines whether a car value loss claim is allowed.

These claims are typically filed against the at-fault driver’s liability auto insurance, making eligibility and documentation key to whether compensation is possible.

If you need affordable auto insurance to cover DV claims, enter your ZIP code into our free quote comparison tool.

Diminished Value Claims Explained

When an accident permanently reduces a car’s resale value after full repairs, insurers refer to that loss as diminished value.

Even when repairs restore the car’s function and appearance, its accident history, often listed on vehicle reports, is the biggest factor reducing resale value.

Diminished Value Claims: Key Details

For example, if a vehicle was worth $20,000 before an accident and is only worth $17,000 afterward, the $3,000 difference represents diminished value.

Diminished value claims generally apply if the accident was clearly caused by another driver, since the at-fault party’s liability insurance is responsible for paying the claim.

Insurers typically require stronger evidence for a vehicle value loss claim, such as professional appraisals, market comparisons, and repair documentation, to substantiate the loss.

There are two main types of diminished value in insurance you can file claims for: immediate and inherent DV.

• Immediate Diminished Value Claim: Occurs right after the accident, before repairs are completed
• Inherent Diminished Value Claim: Reflects the long-term loss caused by a permanent accident record

Inherent diminished value often applies even when repairs fully restore the vehicle’s appearance and performance.

Insurers frequently dispute inherent diminished value because it is tied to market perception rather than physical damage (Read More: Best Auto Insurance Companies for Claims Handling).

Although less common, repair-related diminished value is another type of claim. It results from incomplete or improper repairs that leave lasting defects or reduce vehicle reliability.

However, you may not be eligible for a repair-related claim if the cost of repairs exceeds the value of your car.

Auto Insurance Diminished Value vs. Total Loss

Insurance outcomes vary significantly depending on whether a damaged vehicle is repairable or a write-off.

When repairs are possible, insurers assess whether the car’s accident history has permanently reduced its resale value. This can result in a loss-in-market-value claim tied to the gap between the vehicle’s pre- and post-repair values.

Diminished Value vs. Total Loss: Key Differences

How insurers handle your post-repair value claim also depends on the company and the evidence provided. If the accident is your fault, diminished value is generally not recoverable.

If damage is too extensive and repair costs exceed the vehicle’s value, the claim is classified as a total loss, and payment is based on actual cash value rather than resale value.

Many carriers listed review these claims only when liability is clearly established, and the claim is filed against their insured.

To assess payouts, adjusters typically apply a mileage multiplier to account for age and use, then apply a damage multiplier to reflect repair severity and structural impact.

Read More: At-Fault Accidents & Insurance Rates

How to Calculate Diminished Value

Diminished value is commonly calculated using a standardized method that estimates how much a car’s market value drops after an accident.

This process is often used to support a lower-resale-value claim and begins with the vehicle’s pre-accident value. This is an example of a diminished value calculation with a car valued at $20,000 is assigned a base loss of 10%, or $2,000.

How Diminished Value Is Calculated

Insurers often reference widely used pricing guides, such as the Kelley Blue Book diminished value calculator, when determining a vehicle’s pre-accident value.

To understand how claim handling and valuation methods vary, it’s often helpful to compare auto insurance companies before filing or negotiating a DV claim.

Insurance Companies That Accept Diminished Value Claims

Because diminished value claims are negotiated rather than automatic, each company has its own process based on carrier guidelines, state laws, and documentation standards.

Almost all providers request supporting evidence, so obtaining an independent appraisal, market comparisons, and detailed repair receipts can significantly influence whether an insurer accepts the claim and how much is ultimately paid.

Determining Vehicle Market Value Losses

Like a diminished value calculator, this table compares vehicle market value before a crash and after repairs, showing how diminished value affects different vehicle types.

Even when repairs are completed, vehicles typically sell for less due to accident history, which often results in a loss-of-value claim.

Vehicle Market Value vs. Diminished Value Comparison

For example, a compact car drops from $16,000 to $14,000, resulting in a $2,000 diminished value, while a luxury car loses $6,000 after repairs.

Pickup trucks, sedans, and SUVs also show that diminished value increases with higher vehicle prices and resale expectations.

Luxury vehicles experience the highest average loss at 23%, followed by pickup trucks at 21% and SUVs at 20%.

Sedans and compact cars have lower percentage losses, reflecting steadier resale demand (Learn More: Auto Insurance Rates by Vehicle).

Filing a Diminished Value Claim

Unlike other auto insurance claims, a DV claim only covers a vehicle’s lost value after an accident. It focuses on reduced resale value rather than repair costs.

The only type of insurance you can file an auto value reduction claim on is liability or uninsured motorist. This principle applies when filing a USAA diminished value claim, a State Farm diminished value claim, or with any company, though insurer handling may vary.

Diminished Value Claim Eligibility by Coverage Type

Collision, comprehensive, PIP, and MedPay do not compensate for diminished market value because they are designed to cover repairs or medical costs only.

Filing a depreciation claim requires more than showing repair invoices or photos of the damage. Follow these steps to establish a clear link between the accident and your reduced value claim:

• Confirm the other driver was clearly at fault for the accident.
• Gather repair records, photos, and pre-accident market value data.
• Schedule a diminished value appraisal or market comparison.
• Submit the claim to the at-fault driver’s liability insurer.

Once you file a DV claim, you’ll likely need to negotiate the payout when the insurer disputes the valuation.

Strong documentation, including appraisals and market comparisons, can significantly help when providers question the claim’s validity or amount.

Knowing when to file is also important. State-level allowances vary, and eligibility depends on more than repair quality alone.

For instance, you won’t be eligible if you’re at fault for the collision or drive an older vehicle. Insurers will also reject DV claims where the repairs exceed the value of the car,

How Diminished Value Claims Work by State

Diminished value claims are not treated the same way nationwide. Whether an insurer must recognize a vehicle’s post-accident loss in value depends largely on state law, court precedent, and how insurers interpret liability obligations.

Some states clearly allow diminished value claims; others restrict their application; and a few do not recognize them at all.

In states with restrictions, insurers may deny claims unless specific legal or evidentiary standards are met.

Knowing where diminished value claims are permitted helps drivers set expectations and determine whether to gather documentation and negotiate with insurers.

Get the Most Out of a Diminished Value Claim

Diminished value claims help drivers recover the hidden financial loss that remains after an accident, even when repairs are completed correctly.

These claims are typically available only to not-at-fault drivers and are usually filed against the other party’s liability coverage, not their own collision or comprehensive policies.

Eligibility depends on fault, state law, vehicle condition, and supporting proof such as appraisals and local market trends. Totaled vehicles are generally excluded.

When properly documented and filed in an eligible state, a diminished value claim can help protect a vehicle’s true resale value and reduce long-term financial loss after an accident.

You can only file diminished value claims on certain types of auto insurance. Enter your ZIP code to compare policies near you.