I watched an auto insurance commercial that talked about coverage for deminished value when a classic is involved in a collision or other loss where the classic car is damaged. Is this really a concern when dealing with a restored car as long as original parts can be found to repair the damage?

 

I think that it is a significant issue with classics. People value an un-hit body more than one that has had parts replaced or repaired.

Especially with fiberglass Corvettes, replacement and repaired body parts are often obvious.

 

I think it's a concern with all previously no-hit vehicles. But I understand it's subject to State insurance laws and they vary greatly. Some States have allowed it's consideration and others don't.

 

I dont know about classic cars diminished value but it certainly makes a difference on late model cars . The wife and i are currently going through small claims for an accident we were involved in when a kid ran a red light and we hit her . the diminished value came to $15k that an appraiser said we would loose on a trade in . If there is coverage for diminished value i will certainly get it when i renew , especially on my c2.

 

I think this is a very real issue. Case in point... .I had leased a new 2014 Mercedes Benz E-class. My lovely wife was the primary driver. After having the car for about a month with under 500 miles on the odometer my wife was hit head on while stopped at a red light by a 16 year old kid trying to make a left hand turn while driving his fathers pickup truck. The car sustained $18K in damages and his insurance company had the car repaired. At the end of the 2 year lease the car had under 10K miles on it and we wanted to buy the car. But when I ran the car fax report my brother who is in the auto industry said the bad report would make it hard to sell later on and the value would take a major hit. I had to walk away from the car and leased another M/B. I heard later from my salesman that the dealership wholesaled the car.

Even classic cars will have a car fax report after an insurance claim is filed.

 

Think about a true 'survivor' car.....all original (or at least 95%) with awards for that status. Now GPS-button pushing, texting bimbo hits it hard enough to require a new front clip. Do YOU think it retains its former value ? I sure as hell don't...

 

No it will not. Carfax only reports car back to 1981. Also many body shops will not report damage to Carfax as they do not want to be liable for tarnishing the history of the car. Most accident reports on Carfax come from police reports.

 

With the advent of Carfax, it has become a big issue with late model cars. The first thing people want to do when buying a used car, is see the Carfax. If they see an accident listed, they freak out. If the Carfax shows an accident, it hurts, if it shows an airbag deployment, you might as well scrap the the car.

For these reasons, dealers check the Carfax on anything they're trading in, and reduce trade in value of cars that don't have a "clean" Carfax report.

Since Carfax only works on vehicles with 17 digit VIN's, it's not an issue with any collector cars built before 1980.

I don't see that diminished value would be an issue, on a car that's been repaired correctly. It would only be an issue, when the repairs weren't done properly, such as mismatched paint, or poor panel repair or fit. If an insurance company is paying for repairs, and an owner doesn't think they were done properly, how quick do you think that insurance company will be to honor, a diminished value claim anyway?

As far as no-hit cars, let's be honest, how many legitimate no hit cars are really out there? I've been playing with antique and collector cars for 45 years, and I've seen very few cars that haven't had some kind of repairs.

As Frankie pointed out, a true "survivor" car would be the one situation where I see that it would really pay to have diminished value coverage.

 

I've never seen first party coverage for diminished value and even if available would not buy it unless it was for an orignal survivor. Remember if you are collecting from another company they owe for diminished valve

 

In my case our car was expertly repaired by a top notch shop here , the repair bill was a little over $10k no air bag deployment . However once that reort hits car fax the trade in value is in fact diminished . We talked to the dealership and they said we'll pay you what the car is worth because the report had not hit carfax yet, but once it hits carfax the trade in value would decrease by almost $10k.

 

True but you'll have to take them( the insured not the insurance co.) to small claims court . To me if i can pay a little extra on my premium and collect the diminished value from my ins. co. so i dont have to go through the whole court process its well worth it.

 

I agree that "diminished value" is something that the "guilty party" will normally be accountable for, but sometimes that may be you or one of your family members. If I'm at fault, does my insurance company pay? If the other party is at fault, will my insurance company help me recover from their insurance company? What if they have no insurance, who pays then? It is a topic you should definitely discuss with your insurance agent. It is a topic more frequently discussed on the C6 and C7 Forum and it is surprising how few people have ever heard of it.

I have mentioned pursuing diminished value it to a few friends that were in accidents and most have never heard of it. What wasn't surprising, was the reaction they received when they asked the insurance company about it. Most insurance companies (that will likely have to pay), will put the onus on you to provide a documented amount you are seeking. They will not volunteer anything until you submit a claim for it. In other words you will have to do all the leg work to establish what that amount is.

Again, this is probably a discussion you should have with your insurance company/agent. What is diminished value, how is it established and what you will be required to provide to be compensated for it. After you've been involved in an accident and dealing with all of the other issues, such as getting your car repaired, is not the time to find out that you now have to try to determine what exactly that amount is.

Good luck... GUSTO

 

How about a cherry original front clip from an unrepairable same-year C2? Totalled rear, bent frame, mild fire damage ? The front panels, seams, etc. could be perfect. Might be worth a long search.

 

Quote,

"I don't see that diminished value would be an issue, on a car that's been repaired correctly. It would only be an issue, when the repairs weren't done properly, such as mismatched paint, or poor panel repair or fit."

DV is based on what people think about a damaged car, not the actual repair .

Case in point, Would you pay the full price of a new car that fell off the transport truck or would opt. for a brand new car, fresh from the factory?

 

Some experience to offer here, not talking theory.
A general rule is you will not be able to purchase diminished value coverage for your car. State laws/rules differ, so you have to check/ask. This would be to cover in the event you were "at fault".
If the other driver was "at fault", your repair and medical coverage is a separate issue from diminished value. You will have to claim DV and support your claim. You will likely need the help of a lawyer if it is significant, and a DV specialist to document the claim damage. Insurance industry treats DV like a plague.

DV has no relationship to the repair quality. Rather DV can only be claimed after a "industry acceptable repair" has been completed, but the damage and repairs need documented during the process. Once an "acceptable repair" is complete and any diminished value is totally attributable to the fact damage occurred and not to an inferior repair of that damage.

In a few states, 3 I think, Ga being one, DV is automatic with any claim. Other places, you are on your own.

 

I've been through a diminished value claim on my 2010 ZR1. In the end the at fault insurance company knows they will have to pay out something, the problem is they will low ball you and your only recourse is to take them to court...and usually it is not worth doing that. So it's still a losing proposition, but can get something.

 

Dicecal, correct. If the DV claim is substantiated for say $10,000, you will be offered something like $7,000 to settle from the insurance firm. They know lawyer fees run about 30%. As my lawyer advised me, the difference is $7,000 now or $10,000 minus $3,000 lawyer fees in 3 years. Your choice.

 

We hadnt heard of either until we talked to a prospective buyer of another car we own . We at first were going to claim approx $5000 , until we contacted an appraisal company that specializes in dv . The cost of that service was $275 and he did all the research which brought the dv to near $15k ! It pays to get one of these guys to do the appraisal because imo we would've lost out on a substantial amount. Our insurance co. didn't and hasn't done anything to help us as a matter of fact the other party claimed that their client was only %70 at fault which left us with %30 of the blame . I can only assume that it was cheaper for the ins. co to let that go cause it was cheaper than contesting it in court and the other co was footing the bill for the repairs and we didn't suffer any surcharges, still pisses me off that they let that ride as it may be a point of contention when we go to court. Typical insurance co play.

 

I guess we have different definitions of "survivor"...

 

Classic cars and diminished value? You bet! Not a Corvette story but in 2012 I prepared a diminished value appraisal for the owner of a 1967 Plymouth Barracuda with a '68 factory-bored 340 motor in it, valued at approximately $25,000.00 His repair shop rendered the motor unusable somehow and replaced it with a 318 bored out to 340. The owner felt there would be a loss of value as a result.

Sure enough, after researching the car/motor with several Mopar shops I found that the car suffered $7,500.00 in diminished value.

It doesn't necessarily have to involve a collision loss.