Georgia Diminished Value Law

August 13, 2021

damaged car

If you’re in a car accident in Georgia, one of the first things you might be eager to sort out is your right to recovery. 

The Peach State is a fault-based insurance state, so you will need to seek restitution from the at-fault driver’s insurance provider.

Compensation may cover the repairs to your car, but what about when you are ready to sell it? Will you be reimbursed for the diminished value of a motor vehicle after it’s been in a collision? 

You may be interested in learning more about Georgia’s diminished value law.

taking a photo of damaged car

What Does Diminished Value Mean?

When you’re buying a vehicle, you typically check to see if it has ever been involved in an accident.

If it has since been repaired and now drives like new, the value of the vehicle will drop significantly. 

This is what is called diminished value. Any collision occurrence will drop the value of a car by sometimes thousands of dollars, regardless of the type and quality of repairs. This can put shoppers off from being interested in your car. 

Diminished value is a future loss that claimants must be aware of when calculating their claims.  While not an out-of-pocket expense, it is still money you would have received if you had not been involved in a crash. 

Therefore, the at-fault driver should be liable to pay for these potential losses. It is essential to understand Georgia’s diminished value law. Insurance companies will never remind you of this or offer to pay the reduced value of your car unless you ask. Many insurance companies will intentionally keep this little-known law to themselves, and many have held untold amounts of money from claimants by failing to disclose the diminished value law. 

An experienced personal injury attorney will know about this, and they will fight to get you reimbursed. 

How to Use the Law to Your Advantage

In Georgia, you have the right to claim any amount of money you think you may lose in a sale due to the depreciation of your car’s value. 

At The Pendergrass Law Firm, PC, we will help calculate this amount by determining the value of your car before and after the collision. 

Getting quick, low-quality work done on your car can also diminish its value. You may be able to qualify for more significant compensation if you have received incorrect or inadequate repairs following an accident. As soon as you have calculated the diminished value of your car, you can ask the insurance company to consider your request and wait for them to accept or deny the amount you seek. 

Checklist for a Diminished Value Claim

Part of your checklist for determining if you are eligible for a diminished value claim includes:

Age of Vehicle and Market Value

Only cars with a substantial market value of over $7,000 may be eligible for a diminished value claim in Georgia. You may not be eligible if the market value is below $7,000. 

Additionally, the car must be less than ten years old to qualify. 

Title

Claimants must have a clean title. It cannot have a salvage or rebuilt title, or else it may not be eligible for this benefit. 

Mileage

Qualifying vehicles must have low-to-mid mileage to be entitled to a diminished value claim. They cannot have “excessive mileage” of over 30,000 miles per year. 

Vehicle Accident History

If your car has been involved in more than one collision with extensive damage, you may be disqualified from this benefit. 

Please note that insurance companies and buyers will check the history of your vehicle through companies like CarFax, so make sure that you are forthright regarding any repairs. 

Release of Liability Form

You will be disqualified for a diminished value claim if you have at any point signed a release of liability form. 

Always consult with a skilled personal injury lawyer to make sure you are entitled under Georgia law. Insurance companies must pay the diminished value of your car if you are a qualified claimant. 

Statute of Limitations

You can only qualify if your claim is filed before the statute of limitations expires. 

Each state has different laws regarding set time limits for various actionable claims. In Georgia, this legal timeframe is four years.

There may be a few exceptions to the statute of limitations. For example, it may be extended if:

  • The claimant has a mental illness and is found to be incompetent
  • The at-fault driver was outside of Georgia at any time during the four years
  • The claimant is under the age of 18 at the time of the collision

Always refer to your personal injury attorney to verify the amount of time you have to file your claim. 

If you seek to file for reimbursement for the diminished value of your property after the statute of limitations has expired, your case will likely not qualify. It is crucial to retain the services of legal counsel as soon as possible after the accident so you can get the total compensation you deserve.

Photo of bumped car door

How to Calculate Diminished Value

Since every car crash is unique and valuation concerns are subjective, there is no cut-and-dried amount that a diminished value claim is worth. There is an abundance of diminished value calculators online, but these are rarely as helpful as the assistance from an accomplished legal professional. 

One thing is sure: Insurance companies will likely offer much less than your claim is ultimately worth. In fact, they may offer only ten percent of the actual value of your claim. Knowing this, it is vital to have someone with legal knowledge negotiate on your behalf. 

Furthermore, you should know that your diminished value claim is likely to go up if you were injured during the collision. This fact holds true whether you are ready to file a personal injury claim or are already in the negotiations stage. 

Along with your skilled car accident attorney, there are three steps you can take to calculate the diminished value in the State of Georgia. 

The first step is figuring out the market value of your vehicle. Secondly, determine what the current value is by subtracting the market value of the vehicle’s current condition with the repair costs and current valuation of your car before and after the accident. The difference is the diminished value for your vehicle. 

Finally, once you have these values, you can subtract the current value from the market value to get a reasonable estimate of the diminished value. 

Your personal injury lawyer can help you calculate these values. 

Securing the legal services of a seasoned lawyer will ensure that you get the maximum amount for your diminished value claim. Negotiations can be challenging and tricky, which is why it is essential to have a legal professional mediate on your behalf. For one, it allows insurance companies to see that you are unwilling to settle for a lower amount.  

What You Can Do If the Insurance Companies Do Not Cooperate

Insurance companies will always fight to lower their payout to you. In Georgia, the law requires that insurance providers cover the diminished value even when you are at fault for the crash.

However, there are many tactics that insurance companies will use to undervalue or disqualify your claim.

For example, they may state that your claim should be disqualified or that it is not worth as much as you are requesting. Insurance claims adjusters are skilled when it comes to negotiating with claimants. They may try to weaken or intimidate you unless you are using a professional lawyer.  

If the insurance company simply denies your claim because they hope you will drop the matter, you may have grounds for a bad faith insurance lawsuit. 

The Pendergrass Law Firm can help you negotiate appropriate financial compensation.

Why You Should Seek a Competent Law Firm

Whether or not you qualify for a diminished value claim, it is always best to have the help of a knowledgeable personal injury lawyer when you file. 

As we discussed, it can be challenging to deal with insurance companies. They will try to dispute with your claim and the worth of your vehicle. They will work hard to undervalue your claim or seek to disqualify it. 

It is their job to be experts in manipulation and negotiation tactics. 

It is also your lawyer’s job to counter-negotiate to get you the maximum financial compensation. 

We will go over your claim at Pendergrass Law Firm to determine if it qualifies for diminished value benefits. If it does, we will help you file it. 

If you have been in a collision and want remuneration for the diminished value of your vehicle, we invite you to schedule a free consultation with us as soon as you can. Do not let stingy insurance claims adjusters deny you the money you deserve.