Car accidents remain a top public safety threat in the United States. According to the National Safety Council (NSC), the number of catastrophic accidents jumped by nearly 25 percent in 2020. A serious crash can result in severe injuries and, potentially, render a car unrepairable. Following an accident, you and your family need financial compensation to pay your bills—including the full cost of automobile repairs and coverage for depreciation of value.
At Ladah Law Firm, we are committed to protecting the legal rights and financial interests of motor vehicle accident victims in Las Vegas and throughout Southern Nevada. If your vehicle sustained significant damage in a collision, you need financial compensation to pay for repairs and cover any depreciation in the value of your car. In this article, you will find an overview of the most important things you need to know about car crashes, vehicle depreciation, and diminution of value claims.
A term frequently used in business, economics, and finances, ‘depreciation’ describes the reduction in value of an asset over time. As a simple example, kitchen appliances depreciate. The refrigerator that you purchased five years ago does not have the same resale value as it used to—even if it still works just as well. For most people, the biggest asset they own that depreciates is the automobile. You may already be aware that brand new cars depreciate rapidly as soon as they leave the lot and then lose their value much more slowly as time passes. Indeed, Carfax, “cars typically lose more than 10% of their value in the first month.” Here are some of the key factors that affect how fast a vehicle’s value depreciates include:
A major car accident can lead to immediate, unrecoverable depreciation—even if the vehicle can be fully repaired and restored. This is one of the most important things to understand about car accidents and depreciation: The concept of depreciation can cause a vehicle involved in a crash to lose the value that can never be gained back. The key issue is that many car buyers are hesitant to purchase used vehicles that have been involved in crashes—regardless of how the vehicle looks or what type of repairs it has received.
You may be wondering: How much does a car depreciate in an accident? The answer depends on many different factors, including the specific make and model of the vehicle and the severity of the accident. Another report from Carfax that the average vehicle loses $500 in resale value in depreciation if it has an accident on its record. The number spikes to an average of $2,100 in depreciation if the vehicle sustained significant damage. After a crash, it is important to remember that your car will lose value beyond the cost of repairs.
Following a major collision in Las Vegas, you need money to pay your bills. We live in a fault-based auto accident jurisdiction. Under Nevada law (N.R.S. § 41-141), car accident liability falls under the state’s comparative negligence legal standard. In effect, the party responsible for causing a crash—through their recklessness, carelessness, and otherwise wrongful conduct—can be held liable for the damages. If another driver was at-fault for your entire accident, their insurers should be required to cover the cost of your damages, including vehicle repairs, loss of value (depreciation) of your care, medical bills, lost wages, and pain and suffering.
Notably, most auto accident claims are handled by the big insurance companies. Insurers can be very difficult to work with after an accident. In fact, even your own insurance policy provider may give you a hard time. In many cases, insurance companies try to undervalue damages. They may not fully consider the depreciation of your vehicle. It is crucial that you are able to recover the full and fair financial support that you rightfully deserve. If you were hurt in a crash or you are locked in a dispute with an insurance company, please do not hesitate to reach out to our Las Vegas car accident attorneys for help.
In Nevada, you have a right to get financial compensation from the at-fault party for all of the repairs that are reasonably necessary and related to your crash. You should not be made to bear the out-of-pocket cost of vehicle repairs if another driver was at-fault for your crash. The at-fault party and their insurance provider have a legal responsibility to make you ‘whole’—meaning providing the compensation needed to repair your car and get it back on the road. If your vehicle was totaled in the crash, you have the right to seek financial compensation for a suitable replacement.
Beyond the cost of vehicle repairs, you also have the right to pursue financial compensation for the depreciation of your automobile. In effect, you are owed money for the loss of value that can never be fully recovered through repairs. Remember, when a vehicle has a crash in its history, it loses some resale value forever. This is especially true with luxury cars. The greater a vehicle’s pre-accident value, the more likely it sustained significant depreciation due to the crash.
You can file for compensation for depreciation through something called a “diminution of value” claim. As defined by the Cornell Legal Information Institute, diminution of value is a legal term of art that is used to describe an asset’s loss of intangible value. If you have any questions or concerns about filing a diminution of value for depreciation after an accident, please contact our Las Vegas car accident lawyers for help.
The article explains that automobiles depreciate (lose resale value) after an accident. As noted previously, the primary reason for this is that many consumers avoid buying vehicles that were involved in a crash. Even after full repairs, people are worried that these cars may simply not be as reliable. This raises an important question: How can people tell if a vehicle has been involved in an accident? The most common answer is something called a ‘VIN check’:
Vehicle Identification Number (VIN): A Vehicle Identification Number or VIN is a 17-digit-code used to officially identify a specific vehicle. Each car on the road in the United States has a unique VIN assigned to it. For nearly four decades, all VINs have been 17 digits. If an automobile was manufactured for use in the United States after 1981, it should have a 17 number code assigned to it. These codes are made up of a combination of numbers and letters.
Given the growth of the internet, it is easier than ever to run a ‘VIN check’ on a vehicle. Essentially, this means that people can look up a car VIN to see if it was ever reported as being involved in an accident. Some organizations, including the National Insurance Crime Bureau (NICB) allow people to run free VIN checks. Other commercial companies provide more comprehensive VIN checks to people who want to look up more information about the history of a car. If you have a car’s Vehicle Identification Number, you have the information that you need to check the accident history.
At Ladah Law Firm, our Nevada car accident lawyers are aggressive, results-focused advocates for injured victims and their loved ones. We have recovered more than $150 million for our clients. If you have any questions about how much an automobile depreciates after a crash, we are here to help you find the answers. Give us a call or contact us online for a no-cost, no-obligation review of your case: 702-252-0055.