What is a Diminished Value Claim?

If you have a car and it is involved in an accident, there are minimal chances that its market value will return to what it once was, even after the vehicle is properly repaired. It is just because your car has an accident history. The amount your vehicle has lost as a result of the accident is called diminished value. 

States, including Texas, allow car owners to recover this lost value by filing a claim against the insurance company. This claim is known as a diminished value claim. You can file this claim even after a long time since you repaired your car. 

Key Aspects of a Diminished Value Claim in Texas

To file a diminished value claim, you must understand the laws related to it. Keep reading with us for that. 

At-Fault States

Texas is a fault state, which means the driver who causes an accident is responsible for all damages to your car, including the diminished value of your vehicle. 

Third-Party Claims

Texas insurance companies are obligated to pay third-party claimants for the loss of market value in their car. So, you can file a claim against the at-fault party’s insurance company. 

Uninsured/Underinsured Motorist Coverage

Uninsured or underinsured motorist coverage is an exception to the third-party claims. It allows you to file your diminished value claim against your own insurance company. The coverage is subject to a deductible, which is usually $250.

First-Party Claims

You may not be able to file a diminished value claim under your own motorist coverage. It is because most insurance policies exclude this coverage.

Statute of Limitations

The statute of limitations is a set time limit within which you need to file the claim. In Texas, you have 2 years from the date of the accident to file a claim or a lawsuit for property damage.