Glossary

Diminished value

The resale value a car loses after a crash, even when fully repaired, because buyers pay less for a car with an accident history.

Also called: DV, inherent diminished value, diminution in value, diminished value claim

Diminished value is the difference between what your car was worth before an accident and what it is worth after being properly repaired. Even a flawless repair leaves the crash on the car's vehicle history report, and many buyers and dealers pay less for that car. This is often called inherent diminished value.

Example: a two-year-old SUV worth $34,000 before a crash is repaired for $9,000. Comparable cars with a reported accident sell for about $30,500, so the diminished value is about $3,500. Some claimants also seek repair-related diminished value when the repair itself is substandard.

Whether you can collect depends mainly on whose insurance you claim against and your state. Claims against the at-fault driver's insurer, as a third-party claim, are widely recognized, because that driver owes you for the full loss. Claims under your own collision coverage are much harder; many policies exclude diminished value, including through the standard ISO endorsement PP 13 01, although Georgia's Supreme Court required insurers to assess it in State Farm v. Mabry (2001). Support a claim with an independent appraisal, comparable sales and the repair invoice, and present it in writing. See diminished value claims.

Last reviewed October 4, 2026

In the index now

Related terms

Third-party claim A claim you make against another driver's insurance for damage or injuries that driver caused, rather than against your own policy. Actual cash value What a car was worth just before a loss — replacement cost minus depreciation — and the basis of most total-loss payouts. Vehicle history report A record compiled from a vehicle identification number showing a used car's title brands, reported accidents, odometer readings and ownership history. Depreciation The loss in a car's value over time from age, mileage and wear, which insurers account for when calculating actual cash value. Endorsement A written amendment to an insurance policy that adds, removes or changes coverage, such as rideshare use, rental coverage or OEM parts.

Related guides

Accidents in a rental car: whose insurance pays How your auto policy, a credit card benefit and the rental company's waiver split the bill after a rental car crash, and the fees that slip through. Diminished value claims Why a repaired car can be worth less after a crash, when you can claim that loss from the at-fault driver's insurer, and how to document the claim.

Related insurers

Auto-Owners Insurance Lansing, Michigan mutual founded in 1916 and sold only through independent agents in 26 states, with strong claims scores and no general telematics program.