Generally, whenever you have been in a car accident, there are three different avenues where coverage may be available: (1) the at-fault driver’s insurance company; (2) collision; or (3) uninsured motorist coverage. This module will explain who will and will not be liable for your diminished value claim.
At-Fault Party’s Liability Insurance – YES!
Whenever you are in an accident and the other driver is at fault, you should be able to claim diminished value with the at-fault party’s insurance carrier. In North Carolina, liability insurance providers are the only party required to investigate and honor a valid diminished value claim. Therefore, a diminished value claim should be available when you are in a multi vehicle accident where that at-fault driver has valid insurance at the time the accident occurred.
Uninsured Motorist Coverage – MAYBE!
Uninsured Motorist Coverage is triggered several different ways which is outside the purview of this article. With that being said, you may be able to use your uninsured motorist coverage for diminish value, so long as your accident was not caused by a hit and run. In North Carolina, uninsured motorist coverage will not likely be available for property damage where the accident was a result of a hit and run, and where the at-fault vehicle was never found.
Important Note: Uninsured Motorist Coverage and diminished value is governed by contract law and the terms of your policy. Therefore, when a claim is being made against one’s own insurance policy for diminished value, the policy language should be examined to determine if coverage will be available.
What if I caused the Accident (Collision Coverage)? – NO!
Diminished value is not available if you are the at-fault driver in an accident. In other words, if you caused the accident, you will not be able to recover diminished value. Therefore, your collision insurance would not cover diminished value.
What if my Damage was Caused by Something other than a Collision– NO!
Diminished value is generally not available if your accident was caused by something other than a collision with another vehicle. Accidents that are caused by things other than a vehicle would fall under your comprehensive coverage and diminished value would not be covered. So, diminished value would not be able to be recovered for things like hitting a door or hail damage.
Important Note: North Carolina is a no contact state. Essentially, this means that a collision only takes place where contact is made between two vehicles. This is important because if you do not make contact with another vehicle, diminished value will not be available. In other words, diminished value can only be claimed when an accident occurs where the party claiming diminished value made contact with another known vehicle and did not cause or contribute to the accident. For more information on North Carolina being a no contact state, please click here.