What is an inferior claim? everything you need to know (2023)

Cars lose value over time due to depreciation caused by factors such as normal wear and tear, mileage and age. However, an accident can cause your vehicle to lose value more quickly, especially if there is more damage.

If you are involved in an accident, your car will lose its value. It represents the difference between your car's pre-accident value and its post-accident value after repairs have been made.

If you file a write-off claim, you can recover some of the money you would have lost by selling your damaged car.

Understanding impairment claims

There are three different types of impairment claims: direct, inherent and repair-related. Here's what you need to know about each.


With an immediate depreciation claim, you are asking for your vehicle's depreciation to be replaced immediately after the accident and before the car is repaired. This type of treatment is unusual. As a rule, you only see claims for immediate value in court.

By nature

After an accident, your car loses value, even if the accident was minor. When you file an inherent depreciation claim, you're essentially asking the insurer to pay you the difference between the car's value after the accident and repairs and the value it would have sold for before the accident.

related to the repair

Repair depreciation occurs when your vehicle is repaired after an accident, but the repair was not done professionally or was of poor quality. As defective parts and incomplete repairs can further reduce the value of your car, you can claim additional depreciation with this type of claim settlement.

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How to calculate depreciation

Most insurance companies use a formula called 17c to calculate the diminished value. Calculating depreciation is a bit complicated, but you can figure it out by doing your own research.

Find out the value of your car

First you need to determine the market value of your car. Sites like NADA, Kelley Blue Book (KBB), and Edmunds have free online tools for this. Be prepared with information about your car such as VIN, mileage and trim level that will be used to estimate its value.

Multiply the value of your car by 10%

The next step is to multiply the market value of your car by 10%. This 10% allowance is known as the base loss, which is often the most your insurance provider will pay you after an insured claim.

However, the depreciation may be less than the actual depreciation of your vehicle. In some countriessuch as GeorgiaInsurers must demonstrate that their basic loss calculations are reasonable. If the amount you will receive from the 17c calculation is significantly less than the cost of your damages, you should talk to an attorney about your state's laws.

Find the custom price

To find your vehicle's adjusted value, you need to find a damage multiplier that correlates to the amount of damage your car sustained in the accident. Once you find the correct damage multiplier, you should multiply that number by the base stat drain.

The damage multipliers are as follows:

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type of damagedamage multiplier

type of damage

Severe structural damage

damage multiplier


type of damage

Major structural damage/panels

damage multiplier


type of damage

Moderate structural/dash damage

damage multiplier


type of damage

Minor structural damage/boards

damage multiplier


type of damage

No structural damage

damage multiplier


Apply the mileage multiplier

Mileage is one of the factors that affect the value of your car. To complete form 17c, you need to find the mileage multiplier for your vehicle and multiply that number by the adjusted value.

MileageMileage multiplier


Under 29,999 miles

Mileage multiplier



20,000 - 39,999 miles

Mileage multiplier



40,000 - 59,999 miles

Mileage multiplier



60,000 - 79,999 miles

Mileage multiplier



80,000 - 99,999 miles

Mileage multiplier



More than 100,000 miles

Mileage multiplier


How to make a claim for impairment

Depreciation claims are different from regular car insurance claims and often require some work on your part. Here's a basic overview of how to file an impairment claim.

Call the insurance company

If you have depreciation protection through insurance, you should contact your insurance company first. Your insurance company can help you decide whether you should file a claim with them or the at-fault driver's insurance company.

Once you have identified the company, call and ask for a depreciation claim. The agent will walk you through the process and tell you what documentation is required. Tell your insurance company that you are starting this process.

Calculate the depreciation of your car

When you apply for depreciation, you are usually responsible for calculating your car's depreciation using form 17c. Make sure you use the correct damage multipliers and mileage multipliers and find out the correct value of your vehicle. Any errors may affect the result of the request.

You can also hire an independent surveyor if you believe that the 17c calculation will cause you significant financial loss.

Wait for the insurer to respond

The last step is to submit all the documents and wait for the response from the insurance company. If the expert needs additional information, e.g. B. vehicle valuation, will inform you about it.

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When should you file an impairment claim?

Although you usually have at least two years to make your depreciation claim, you probably want to make it as soon as possible. This way, you arrive at the cost faster and it is easier to prove the accident and the damage to the car.

If you can't claim the deduction right away, find out how much time your state gives you to file a claim.

How long does it take to resolve a claim for diminished value?

The time it takes to process an impairment claim depends on many factors, including the insurance company's process, the type of impairment claim and your situation. You can expect the process to take at least a few weeks, but it's possible that the insurance company will take more than a month to process it.

Is claiming for depreciation worth it?

Claiming depreciation can be a good option for some drivers, but it depends on the situation. Additionally, each state has different laws regarding depreciation claims and who can file them.

Basically, damages only make sense if you are not at fault for the accident. If you caused the accident, your insurer is unlikely to accept a claim for depreciation. You can also file this type of claim if you are hit by an uninsured driver.

Impairment claims can also be useful if your vehicle has a very high value with low mileage or is almost new. You may be able to get more money back if your application is approved.

If your car was older or already in poor condition, it may not be worth making a claim.

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Frequently Asked Questions (FAQ)

Can he negotiate a lower price?

Lower value is negotiable. Some insurance companies may be willing to negotiate the final payment of the claim, but it all depends on the individual insurer and the specifics of the claim. It's easier to negotiate when you have an independent check to back up your claim.

How much value does a car lose after an accident?

All cars lose value after an accident, but the actual depreciation depends on the severity of the damage, the age of the vehicle and the type of vehicle. However,some estimatesshow that the resale value of a car that has been in an accident drops by about $500.

What is a good car accident settlement offer?

A good car accident settlement offer should cover all expenses incurred in the accident, including medical bills, loss of work or employment, and vehicle damage. If possible, talk to an attorney before accepting a settlement offer.

Is depreciation the same as amortization?

Depreciation and amortization are two different things. Depreciation is the difference between your car's pre-accident market value and its post-accident value after repairs. Depreciation is the reduction in the value of your vehicle over time caused by normal wear and tear. Your car's depreciation is determined based on mileage, age, make, mode and general condition.

Can the damage affect the value of the car?

Claiming depreciation will not affect the value of your car. However, if your vehicle is damaged, its value will decrease even if it is fully repaired.

The information presented here was created independently by the TIME editorial team. To learn more, visit usAbook page.


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