The Missouri Department of Insurance has published a bulletin describing consumer’s rights and process when filing a claim.
Below is the section describing diminished value:
What is diminished value?
“Diminished value is the difference in fair market value of the auto immediately before the accident and the auto immediately after the accident causing the damage. Diminished value may or may not be recoverable under an auto accident claim depending on the relationship between the injured party and the insurance company.”
1st Party claims “If you make a claim under your own policy (e.g. your auto was damaged because you hit a tree), Missouri law does not require insurers to pay for diminished value and there is case law that addresses this issue – Lupo v. Shelter Mutual Insurance Company, 70 S.W.3d 16. In this case, an insured brought action against his own insurance company to recover the diminished value of his adequately repaired car. The insured claimed that his car was worth less than it was before the accident even though the car had been properly and adequately repaired. The court ruled in favor of the insurance company, the insured appealed and the appeals court agreed the insured’s auto policy did not require his insurance company to pay for the diminished value of an adequately repaired car. The law does not prohibit an insurer from offering this type of coverage, so it is always best to read your policy or ask your agent to fi nd out whether your policy will pay you for diminished value claims.”
Third Party Claims: “If you make a claim under someone else’s policy (e.g. your auto is damaged because someone else hit you), Missouri courts have included diminished value as recoverable damages – Rook V. John F. Oliver Trucking Company, 556 S.W.2d 200 (Mo. App. 1977). In this case, the court said the amount of damage should be measured from the fair market value immediately before the collision and the fair market value immediately after the collision. However, if repairs have been made to the auto as a result of the accident, the court said that the dimished value should be the difference between the fair market value immediately before the collision and the fair market value after the repairs.”
If an insurance carrier is rejecting your claim, please contact the Missouri Department of insurance Complaint dept.