Ins Company Penny Pinch & Diminished Value

Mar 22, 2016

  1. sftong

    sftong New Member

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    Hello Helpers, I have been reading through some of the comments here, and understand that the DV (Diminished Value) claim is not straight forward as the Insurance Companies are bitches!

    I live in Ohio and have a Lexus ES 2009, 84K miles, which was recently rear-ended (in Ohio) with cracked bumper and possibly some "bending" of the exhaust pipe. Bring it to the Lexus dealer, and the repair cost was estimated over $2K. But the Insurance switched out the bumper replacement to using a Replacement Part instead of original Lexus part, claiming any car over 5 years and not current mode. So it would not get OEM part. Hence the repair would now come down to less than $1500.

    By Kelly Blue Book Estimates, pre-accident trade in value ranges from 11K to $13K based on varying conditions, and private sale is about $13K.

    Appreciate if you can shed some lights on the following:
    1) Is the adjuster right about using the replacement part for my OEM part?! I mean, I am a victim here, and I see that the Ins is making fxcking excuses to avoid doing the right thing!

    2) About the DV claims. Based on the 17C formula, with based value of 10% of Vehicle, what is the proper "Damage Multiplier" should be used? After all those stupids and flaw multipliers, I guess I would be lucky to see $300 DV claim.

    Or you think I should go to the trouble of hiring an expert in assessing the DV? How much would that be?

    3) Due to various phone calls, and sending car in for repair estimates, these have taken hours of my time. Shouldn't the Ins reimburse my time?

    I mean, I am a victim in this accident, yet at the end, I wasted hours of my time + getting a lousy replacement part + loss of DV of car. Feel like Ins company is rubbing salt into wound.

    sftong, Mar 22, 2016
  2. Josh

    Josh Retired Agent, Current List Broker

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    Warning: You won't like the answers.

    Most states don't have DV at all.

    I'm sure it's a beautiful car. It's a 7-8 year old car approaching 100k miles.

    So a minor repair.

    The only people that use KBB are folks looking online. Insurance companies actually take a look at, among other things, what cars in that area are going for.

    Using OEM is not the right thing to do. It's an older car with a lot of miles on it. I'm sure you're attached to your car and think it deserves nothing but the best, but the reality is aftermarket parts are great too. [/quote]

    2) About the DV claims. Based on the 17C formula, with based value of 10% of Vehicle, what is the proper "Damage Multiplier" should be used? After all those stupids and flaw multipliers, I guess I would be lucky to see $300 DV claim. [/quote]

    If we're being honest, the DV on this small of an accident is almost non-existent. As you've described it there is no major damage to the frame or anything complicated like that, so the DV claim is probably just free money for you in all practical terms.

    Do it. Any expert is going to tell you that you've hit your head to fight this. More appropriately, it's really just personal. Most of us, even if we drive an old car, take it personal when it gets damaged, but in dollars and cents you're not getting hurt here.

    Nope. Not a dime. I'm sure some cases have been fought on that argument, but I'm equally certain they'd never win. It sucks to be an adult, but when things like this happen making phone calls comes with the turf. You're also the one getting estimates, the insurance company would pay for the repair, usually at any shop of your choice, without you having to shop.

    You're making yourself the victim. Any aftermarket part the dealer would install is usually going to be of high quality and on top of that you're getting extra money on the DV that most states don't even allow for. The true DV on the accident as you've described it really sounds like almost nothing.
    Josh, Mar 22, 2016
  3. djs

    djs Super Moderator Moderator

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    I'll ditto what Josh said. Diminished value is for accidents that affect the viability of the car, not for a minor ding. At $2000 for the repair, this is a minor ding.

    The part you had on the car was used. Okay, it was new when the car was new, but on the day of the accident, it was a used part. The goal here is to make it the same as before the accident, not necessarily improve it. A new OEM part would be an improvement.

    It sounds like the insurance company is paying the bill, probably providing you a rental car while yours is being fixed, taking care of business. We all want more, but it seems like they are doing what is required and expected.

    djs, Mar 22, 2016
  4. mattupthehill

    mattupthehill Expert

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    Another thing to ask is if you take it to the Insurance Companies preferred shop, will they guarantee the repair. This may put you a little more at ease when it comes to aftermarket vs. OEM parts.
  5. pfg1

    pfg1 Guru

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    The last time I was in an accident, that is what the Ins company wanted me to do. It was the other persons fault, but we ended up having the same ins company. Preferred shop gave lifetime warranty on the repairs.

    And fwiw, my car was under 2yrs old with low miles and they used a (new) aftermarket bumper cover and fender. I saw it on the estimate, and asked about it... they said that is typical these days unless the car is basically very new.
    pfg1, Mar 22, 2016
  6. InsCommentary

    InsCommentary Guru

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    Outside of Georgia, I'm not aware of any carriers paying DV on physical damage claims. Most auto policies specifically exclude it. READ THE POLICY.
  7. ModernInsurance

    ModernInsurance Super Genius

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    Very typical. Unless a policy has an "OEM equipment" endorsement (not all carriers offer them), they will use like kind and quality (LKQ) parts.

    As the rest of the respondents have stated - suck it up and move on. You've already spent too much of your time on this claim. If the fit and finish look fine, what's the difference???
  8. leonard

    leonard Expert

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    I am an agent, but not a P&C agent. Some years back i had a friend who owned a body shop. He preferred using fenders, etc that were made by the manufacturer. He said Aftermarket parts may not fit the same as OEM, and he may have to extra spend time either to make them fit, or to make sure the gaps are consistent. He also said that some of the aftermarket fenders, etc weigh less than the oem.

    I do not know if this is the same today, but since there is a problem of consistent quality from products from china, whether they are metal or plastic or vitamins, i imagine the car companies hold the parts manufacturers to a higher standard than the aftermarket companies do.

    Someone will probably write back that they are exactly the same. So before that happens, i will ask if everyone thinks generic prescriptions are exactly the same as non-generics. They are not. I do not remember the leeway they are granted, but i think it is around 15%. So if you have been taking a 100mg pill, and switch to a generic, you might end up with 85mg or 115mg. There have been cases of people being able to tolerate a brand name script, but when switched to a generic [even if they did not know of the switch] they could not tolerate the medicine. This may have been due to a different filler ingredient being used.

    Recently I was at car dealer for a problem with the heated seat. They said the part would have to be shipped in from Germany. I feel confident that the part has a better chance of lasting a long time, than if it was an aftermarket part coming from china.

    However, i had a disagreement with the same dealer when a $5,000 computer module went out [during the warranty]. That was for the part, labor was negligible. it was replaced with a remanufactured part. Dealer said that is what most car companies are doing, said to read my warranty info. [They did offer to put in a brand new one, if i wanted to pay the difference, which was several thousand dollars.].
    leonard, Apr 21, 2016