You’ve finally purchased that new car. You negotiated a fair price and got the color you wanted. As you drive it off the lot, another car comes speeding along and slams into you from behind. Have you heard this story before? As injury lawyers serving MA and RI, we’ve heard it more than a few times. If you’re fortunate enough to avoid serious injury, your next concern is likely worrying about the money you just lost in a matter of seconds.
How Much Value Does a Car Lose After an Accident?
Currently, if your vehicle is damaged in an auto accident in Massachusetts by another driver who is at-fault, the at-fault driver’s insurance company is responsible for paying for your vehicle repairs. That’s well and good to get you back on the road, but what happens when you decide to sell that car in the future? When it comes to resale, you’re likely going to get less money for that same car because it’s been involved in a crash.
So, just how much value does your car lose after it’s been involved in a crash? That depends on a number of factors including, of course, year, make, model, and mileage, but also whether the vehicle has been involved in a serious collision or a minor wreck. According to a recent report, online auto sites show the loss in value is typically between 10-25%. On average, this amounts to a loss of about $2,000 in value for a car involved in a serious wreck, and approximately $500 for all vehicles involved in crashes.
This loss in value is called intangible value– what happens after the vehicle is fully repaired but regardless, its resale value still plummets. The insurance companies refer to this intangible loss as “inherent diminished value”, or IDV. If you’ve been in a car accident, whether your car is new or old, and even if it’s been meticulously repaired after the collision, you’ve probably experienced some surprise at the price hit it has taken when you decide to sell it on the private market or back to a dealer.
How Might IDV Change for Massachusetts Drivers?
Until now, the insurance companies have been responsible for paying for vehicle repairs, but not IDV. Therefore, the owner of the vehicle is on the line for absorbing whatever loss in value takes place upon resale. However, a Supreme Judicial Court ruling in Massachusetts on October 19, 2021 is changing who is monetarily affected by that loss in value. With this new ruling, the court says that the at-fault insurance company is now responsible for the loss in value, or IDV.
If you do qualify, getting compensated for the IDV is not automatic at this time. Claimants wishing to seek compensation are responsible for proving and quantifying their loss to the court, likely with the support of an accident attorney who will probably involve outside experts, such as licensed appraisers. Currently, there is no method specified to quantify the amount of damage and therefore, it’s expected insurance companies will fight this ruling as such. It also remains to be seen whether the ruling will be retroactive for past cases.
Contact an Injury Attorney in MA or RI After Your Car Accident
It’s important to note the Massachusetts ruling applies only to owners whose vehicles have been damaged due to the fault of another driver. The IDV ruling does not currently apply to those involved in accidents where they are at fault themselves. If you think this new ruling may apply to you, consult with an injury lawyer experienced with car accident law in Massachusetts to determine your eligibility. Even if you aren’t eligible to collect this specific IDV compensation, you may be eligible to seek compensation from the insurance company after your car accident for your damages including medical expenses, lost wages, vehicle repair bills, and pain and suffering. To protect your legal rights and ensure you are treated fairly by the insurance companies, contact a top-rated attorney with decades of experience with personal injury law in MA and RI. Attorney David Tapalian will make sure you receive the compensation you deserve. Call Tapalian Law today at 401-552-5000, to schedule your free consultation.