Unveiling The Different Types Of Diminished Value
Accidents are inevitable and possible with anyone. Besides giving the pain of injuries, they also give the pain of damaged vehicle. Every time a vehicle suffers a major accident, its owner knocks the door of insurance companies. Reason behind is obvious, the aim of claiming money according to the damage of the car. However, this is not as simple as it looks because insurance companies are not that customer friendly. Besides making the procedure lengthy and complicated, they don’t provide the genuine amount of money. A better and smart alternative over insurance providers are third party people. These external people are known as ‘auto appraisers’. Just like their name, they help in appraising the insurance money and provide the customers with the right sum finances.
Diminished value is an important aspect of car appraisals, estimation and pre-purchase inspections. Auto appraisal needs to be taken seriously, as it is one of the main reasons behind car value depreciation. When a car or any vehicle undergoes an accident, getting a diminished value assessment before as well as after the repairs is very important. This is necessary, as it ensures that the vehicle value is registered in case of insurance purposes, lawsuits and faulty repairs. Let’s discuss this concept in a bit detail.
Understanding Diminished Value Appraisal
There are three types of diminished value that can be determined. These are:
1. Immediate diminished value
2. Inherent diminished value
3. Repair related diminished value
Talking about immediate diminished value, it tells about the difference in the resale price without any damage to the car. This is that value that is used to offset lawsuit or insurance claims after an accident occurs and the vehicle suffers from collision. Moving on to inherent value, this refers to the value of the vehicle that is calculated after the repairs are done. Important thing to know here is that, under this diminished value appraisal, it is assumed that the repairs made are truly professional.
Finally, the third and last type, i.e. repair related value refers to the value of the car after less than normal repairs have rendered more damage to the car. This is used in sales transactions, as less than favorable repairs reduce the value even more.
With the help of professional auto appraisers, it is assured that all the assessments are done as per the industry standards. Moreover, they also help in providing expert witness services if needed. Giving the wrecked vehicle its old look back is possible only with the right appraisal. While sometimes clients get less amount, they get more than expected funds other times. It all depends on the vehicle, type and experience of the appraisers.