Since you already have insurance, you already know the difficulties involved in finding the right auto insurance policy. Nonetheless, there is no one specific auto insurance policy for all vehicles. When you decide to buy insurance for your vehicle, your insurance company will have to take into consideration a lot of factors before arriving at a premium rate. Some of the things they put into consideration include age, gender, car make, model and year as well as your driving history. All these things will definitely impact your premium rate. And the amount of coverage your insurance will give you after getting involved in an accident will be determined by the pre-loss value of your vehicle.
Car Diminished Value and Selling It
After getting involved in a traffic collision, you will have to file a claim with your insurance company. If everything goes just as expected and there are no discrepancies, your insurance company will cover the cost of repairs and your vehicle will be back in shape in no time at all.
But as is life, things are never that easy. For instance, you were in a traffic collision that caused severe damages to your car. After all said and done, your insurance company agrees to cover the expenses. Now your car is back in shape and you drive it for a few more years. In the hope of getting more money to buy a much better car, you decide to put your car on the market for the same standard price. Luckily, a buyer shows interest and as usual, you arrange to meet in a specific location so they can take the car for a test drive.
In the end, the buyer likes what he saw and is ready to make a deal. Surprisingly, he proposed a far low price and is unwilling to negotiate, citing your car’s accident history. Despite the fact that your car was fully repaired and in top shape, its resale value reduced drastically, thanks to the accident history. This is what is known as car diminished value
However, the car diminished value claims can be applied to your auto insurance policy but there are some factors to consider. This includes legislation, court rulings and the at-fault party in the traffic collision. In some states, you have no right to car diminished value claim if you were the at-fault party. On the other hand, if you are not guilty then your insurance company is required by law to award you reparation for the diminished value of your vehicle.