Expert: Charlie Barone - 8/10/2009

Question
Hi Charlie,

About a year ago, I was rear-ended in Southern California.  My 2003 Infiniti FX35 sustained $14,000 damages and the at fault's insurance company, AAA, paid for all repairs and the rental car cost.  Through this website, I found out more about diminished value and decided to proceed with DV claim.  Here is a summary of my diminished value claim:

1.  Got an in-person appraisal with a certified appraiser from Auto Appraisal Group.  They inspected and determined that my car, after being repaired lost $3,888 market value compare to similar vehicles without accidents.

2. I forwarded the appraisal along with a letter of demand to the at fault's insurance company and asked for the full amount of the diminshed value.  I also provided them with a copy of the NADA Used Car Guide used by the appraisal as well.

3. At fault's insurance company denied the claim by saying that they did not feel I have provided enough to support my claim request of $3888 in diminished value.

My questions for you are:

On what basis is the insurance company denying this claim and what qualifications does the adjuster have to flatly deny the claim?

What additional information is the insurance company looking for?

How should I reply to the denial of my claim?

Is my only option now is taking to the at-fault to small claims court?

Thank you in advance for your help.

Sincerely,

Spencer

Answer
Spencer,

The liability carrier's response is typical of insurers. However, you are owed this loss of value, including the cost of the appraisal. I am surprised somewhat that Auto Appraisal Group is not supporting you as they should, but I will let you in on what you need to know and how to get a settlement. First of all, the insurer of the at-fault party has no legal duty to you for your loss, so no matter what you provide to them with your claim they are likely to respond negatively. This works for insurers, as many claimants simply give up when the get these type of responses.

The party who owes you for this loss is the driver of the other car---the at fault party. Send them the demand with a cc to AAA and tell them you will take whatever legal means are necessary to recover your loss. Let them know that their insurance company has exposed them to this liability. If you have done this already and are still getting stiff-armed by AAA, then file in small claims court for the loss. Once you have a judgment against their policyholder, AAA will have to pay you.

Good luck,

Charlie