What is a Diminished Value Calculator and How Can It Help You Recover Your Car’s True Value?

Dec 6, 2023

What Is Diminished Value

When a vehicle is in an accident, its trade-in or resale value almost always drops. Even if the vehicle is repaired and returned to its original condition, it simply won’t bring as much as it would have had it not been wrecked.

If the other driver was at fault in the accident, however, you may be able to recover the difference between what your vehicle would have brought on the market or as a trade-in before it was wrecked and what you could expect to get with an accident in its history. This difference is known as “diminished value.

How Do I Calculate a Diminished Value Amount?

To get a general idea of what an insurance company will pay in a diminished value claim, you can go online and search for a diminished value calculator.

A diminished value calculator is a tool that uses a  step by step formula to figure how much a claim is worth. The National Automobile Dealers Association (NADA) and Kelley Blue Book (KBB) have free online DV calculators on their websites that you can use. 

You’ll need to know the value of your car before it was wrecked and you’ll then have to fill in make, model, year, mileage, and the extent of the damage in order to get an idea of the vehicle’s value.

In a nutshell, this is how it works. A DV calculator will start with the worth of your car pre-accident and then apply a 10% cap, which is the base loss value, or the max most insurance companies are willing to pay out in a diminished value settlement.

After that, a damage multiplier will be applied. This depends on the severity of your car’s damage and uses a scale of 0 to 1. If severe damage was sustained, for example, you would multiply by 1; if only minor damage occurred, you would multiply by .25

Last, the figure is adjusted to reflect mileage. The higher the mileage, the less your claim is worth.

Can a Diminished Value Calculator Help Recover My Car’s True Value?

Ah! There’s the problem: online DV calculators are notorious for undervaluing a claim. All the diminished value calculators take into account are age, mileage, and car model. An accurate diminished value figure can be influenced by so much more, though, such as how well a car was maintained and any extras it might have. The online calculators don’t account for such details, and it can cost you in the long run.

How Can I Get the Most From My DV Claim?

Taking your car to a qualified auto appraiser is the most sure-fire means of getting an accurate car valuation and recovering a higher settlement on your diminished value claim. Using a licensed appraiser can help you recover far more, and if your vehicle is a high end model, that difference can be in the thousands or even tens of thousands of dollars! 

Auto appraisers take everything into account when valuing your vehicle–all the details a DV calculator leaves out find their way into a professional appraiser’s report. 

Using a professional auto appraiser can also have the effect of improving your chances at the negotiating table; insurance companies have a harder time disputing an expert. They’d much rather have you trust the online calculator–that usually saves them a lot of money!

Auto Mediator is among the most trusted names in auto appraisal. WIth over 20 years of experience, they know the auto industry and are experts in all aspects of the auto market. When accuracy counts, rely on Auto Mediator for any car valuation needed.