Maryland Diminished Value Accident Claims

Many people who are seriously injured in a car accident in Maryland initially seem more upset about their property damage and the insurance companies' refusal to pay for the diminished value of their vehicle.

diminshed value

Why is this? Insurance companies do not settle serious accident claims - not typically, anyway - until far later down the road when the client has recovered or reached maximum medical improvement (the healing has come as far as it will). Property damage claims are immediate, so it gives the victim the first glace of the extent to which the insurance company will completely jerk them around. Diminished value claims are tailor-made for insurance companies not to play it straight.

Insurance companies do not play fair when it comes to the diminished value of the victim's vehicle.  By taking advantage of victims, they save hundreds of millions of dollars a year. 

Theoretically, the law is exactly what it should be. Maryland law allows the victim either (1) the cost of repairing the vehicle and the loss of value of the vehicle because of the accident, or (2) the fair market value of the car if it is a total loss. Specifically, and we flush this out more below, the Maryland Court of Special Appeals found in 1971 that has found that if a "plaintiff can prove that after repairs his vehicle has a diminished market value from being injured, then he can recover in addition to the cost of repairs the diminution in market value, provided the two together do not exceed the decrease in value prior to the repairs.”

Sounds great. The problem is that insurance companies, at least in Maryland, ignore diminished value claims. How? Maryland law allows plaintiffs to bring a diminished value claim, but the insurance companies understand that most lawyers will not touch property damage claims unless they are connected to a serious injury claim (we are guilty of this). So for most diminished value accident claims, no one is willing to hire an expert and file a lawsuit. So, unless you take them to the courthouse steps and beyond, these claims are unlikely to get paid.

This problem has become an even bigger deal with the rise of CarFax which allows everyone to quickly check the accident history of a vehicle. This cuts down the market for potential buyers when you go to sell the car.


      The most surefire way to beat the insurance company in a diminished value claim is the long way -- a lawsuit.  

What is the answer? Well, if you have been seriously injured in an accident, your lawyer may be willing to push the ball on your diminished value claim. If not, there are not a lot of great options. The best is not the one you want to hear: push the insurance company by filing suit on diminished value, let them know you know you need an expert and line one up, and then settle your claim for the best value you can get.

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Diminished Value

Our accident lawyers have also successfully settled thousands of cases for clients injured in automobile accidents, recovering millions of dollars in compensation for victims by settlement or trial in 2017.  If you or someone you love has been very seriously injured or killed in a car accident, call us at 800-553-8082 or click here for a free consultation. (Please note: we do not handle property damage only or minor injury claims.)

Diminished Value Law Around the Country

We have tried to pull some of the law around the country on the issue of diminished value claims. As you will see, the results are mixed:

Good Cases
  • Maryland: Fred Frederick Motors, Inc. v. Krause, 12 Md. App. 62 (1971) (Maryland's intermediate appellate court held that the owner of a car that is damaged may recover any reduction of the vehicle's value that exists after the vehicle has been repaired as well as it reasonably can be repaired.  This means that the correct measure of loss caused by an accident is the difference in market value of the car immediately before the crash and the combined amount of its value immediately after being repaired.)
  • Washington: Moeller v. Farmers Insurance (automobile insurance policy provided coverage for the diminished value of a fully repaired car because the average insurance consumer would read Farmers' policy to provide coverage of equal value to the real loss which includes diminished value)
  • Ohio: Rakich v. Anthem Blue Cross (reversed the lower court finding residual diminution in value. The court said that the claim does not overlap the cost of repairs "because it is calculated based on a comparison of the value of the property before the injury and after repairs are made, i.e., excluding injury compensated by damages for the cost of repair." Court noted in its opinion similar findings in Arizona, Colorado, Florida, Iowa, Louisiana, Mississippi, New Jersey, Oklahoma, South Carolina, Virginia, West Virginia and the District of Columbia.)
Bad Cases
  • Massachusetts: Given v. Commerce Insurance Company (court rejected diminished value claim saying: "We will not torture the plain meaning of the terms 'repair' and 'replace' to encompass 'repair' or 'replace[ment]' of damage caused by stigma, a form of damage that, by definition, defies remedy by way of 'repair' or 'replacement.")
  • South Dakota: Culhane v. Western National Mutual Insurance Company (court disagreed insurer was obligated to pay, citing similar law in Florida, Louisiana, Maine and Massachusetts)
Maryland Expert Witnesses for Diminished Value Claims in Maryland

A diminished value calculator that computes the exact value of the loss on the vehicle that a court could rely upon would make these claims a lot easier to manage. But there is no formula for these appraisals. The loss of value depends on the type of car, the type of collision and a host of other facts.

Keep in mind that there is arguably one flaw in using a blue book calculation.  Some argue that 90% of cars today are sold below blue book value.  Why?  It is common practice for trade-ins to take rebates, incentives and other discounts available to the automotive dealership and add them to the trade-in value of a car during a new car purchase.  This artificially inflates the trade-in value of the car.  Why do dealers do this?  Buyer assume they are getting a better deal when they get more for their trade-in.  It gives the seller credibility that they are fair.  The reality is that they are just giving you more on the trade-in and charging you more on the car.  So this reality improperly inflates the value of cars.  Be prepared for this argument with the insurance adjuster and at trial. 

This is a partial list of experts who provide this type of estimation of loss testimony in Maryland

  • Reed Appraisers: 301-946-6116
  • Collision Consulting: 443-324-4476
  • Randy Cole: 410-207-6294

*Note: Miller & Zois does not endorse these experts. We are merely passing along the names of these experts who may be able to provide evidence that your vehicle is diminished in value because of its repair history. 

Lawsuit Language for Diminished Value Claim


  1. Plaintiff incorporates the above-referenced paragraphs as if the same were fully set forth herein.
  2. Defendant's negligence caused substantial and extensive property damage to Plaintiff's 2013 Honda Accord ("Plaintiff's car").
  3. On the date of this collision, Plaintiff's car had an odometer reading of 742 miles and it had not been previously damaged.
  4. The damage to Plaintiff's car was repaired at a cost of $18,398.16 and took at least 45 days to repair.
  5. As a result of Defendant's negligence, the resale value of the Plaintiff's car has been significantly diminished because future buyers will know of the damage to the vehicle and the price will reflect this car crash.
  6. The car is brand new. There has been no prior damage.
  7. Plaintiff has not been reimbursed for the diminished resale value loss to her vehicle.

WHEREFORE, Plaintiff, demands judgment against Defendant Miner in the amount of Ten Thousand Dollars ($30,000.00) in compensatory damages, plus interest and costs.

Maryland Law on Diminished Value Claims

A diminished value claim is permitted in Maryland if the sum of the diminution in value plus the repair costs is less than the difference between the vehicle's pre-accident value and its post-accident salvage value.

Accordingly, a Maryland plaintiff can claim the smaller of: (1) the sum of the repair costs plus any decrease in value of that vehicle after the repairs, and (2) the difference between the vehicle's value before the car crash and its value after the accident before any repairs (the salvage value).  

If you are taking one of these cases to trial, bring everything relevant to the value of the vehicle including

  • the blue book value and evidence of the value of this vehicle in this jurisdiction
  • recent auction sales of the same vehicle
  • warranty (even if expired)
  • purchase records
  • service records
  • technical service bulletins regarding the vehicle

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