A diminished value lawyer handles claims for the drop in resale value after a crash. These claims are usually small, so most drivers can begin without one. You may want a lawyer when the insurer will not move, the amount is large, or your time to sue is running out.
Do You Need a Diminished Value Lawyer?
Most people do not need one at the start. The loss usually lands near 10% to 20% of the repair total, per a study in the NAIC Journal of Insurance Regulation. It found that attorneys rarely get involved in these claims because the amounts are fairly low.
You can start the claim on your own with a written demand, repair records and an estimate. Our claim steps sort them into the right order.
Problems can still come up. An insurer may argue against your proof, the Washington insurance regulator warns. It adds that you might end up needing legal advice.
When a Lawyer Is Worth It
- The insurer turns you down in writing. The clearest signal is a flat denial after you sent solid proof.
- The amount lost is large. A large claim gives you room to pay a fee and still end up ahead.
- The deadline is close. Every state has its own deadline to file a lawsuit. Look up yours in the state rules table.
- Who was at fault is disputed. The facts decide the claim when the other driver's insurer blames you, and a lawyer can test them.
There is also a strong rule in Georgia. Its statute O.C.G.A. § 33-4-7 says the insurer of the driver at fault has to handle a car damage claim fairly and without delay. Send the demand through certified mail or statutory overnight delivery, and state an exact amount in it.
Suppose the insurer turns you down within 60 days, and its offer came in bad faith. The insurer may then owe the greater of $5,000 or up to 50% of the loss, with reasonable attorney's fees added. A lawyer can ensure the letter follows every one of those rules.
Diminished Value Attorney Fees
Most car accident attorneys are paid through a contingency fee arrangement. You give them a share of any money you collect, and pay zero if you collect nothing. Nolo says the normal share is 33 percent. Other lawyers choose a sliding fee scale instead:
- 25% when you settle with the adjuster and no suit is filed
- 40% if your case goes all the way to trial
Work out the numbers before you sign. For a claim of $2,000, a fee of one third works out to roughly $660.
You should have the terms on paper. You must have a written contingent fee agreement that you sign, according to the ABA model rule on fees. The document must list the percentage the lawyer collects after a settlement, trial or appeal. It must also list which costs are taken out of your money, and if they are taken before the fee or after it. The rule in your state may differ, so go over the agreement closely.
Taking a Case to Small Claims Court on Your Own
When your claim stays below your state's dollar cap, small claims court lets you avoid sharing any of the award with a lawyer. Those dollar caps differ widely from state to state.
In California you can generally sue for at most $12,500, and a lawyer cannot be with you in court. You are free to get advice beforehand, so a diminished value claim lawyer can prepare you before you go in. A small claim in Texas may not go over $20,000.
Proving your loss is still your job. Have the appraisal, the repair shop invoice and the vehicle history report with you. Expert testimony is still the main proof for these claims, based on a 50-state survey by Matthiesen, Wickert and Lehrer. That paper evidence comes from an independent appraisal.
How to Find a Diminished Value Lawyer Near You
Begin with the lawyer referral service run by your state bar. At some services, the price of a first meeting is capped. Through the Florida Bar service, you can get a 30-minute consultation at a cost up to $25. The Virginia service has a $35 referral fee for a meeting up to half an hour.
Before you hire anyone, look up their license. In California, the State Bar posts a list of certified referral services and runs a tool called Check Attorney Profile. Find out the number of auto damage claims the attorney has worked on and whether an early settlement cuts the fee.
What to Gather Before the First Call
- claim numbers for each driver along with the police report
- pictures of the damage taken before repair work began
- the estimate for the repair work, plus the final invoice
- the lost value, shown by your appraisal or estimate
- all letters and emails from the adjuster, with their dates
- A copy of the demand letter you sent, if any.
A well-organized file makes the first call quick. It also makes it quicker for the lawyer to tell you if the claim is worth a fee.