Diminished value claims in New Jersey

Can you claim diminished value in New Jersey?

Short answer: Yes, from the at-fault driver's insurer.

Third-party: the tort measure is the before/after drop in value; cost of repair plus the remaining depreciation in value from the damage is an appropriate measure so long as the sum does not exceed the decline in market value or the pre-accident value (Fanfarillo v. East End Motor Co., 172 N.J. Super. 309, 411 A.2d 1167 (App. Div. 1980), a car stolen from a dealer's lot through the dealer's negligence). First-party: where the policy limits coverage to repair or replacement with like kind and quality, the insurer's liability is capped at restoring the vehicle's physical, operating and mechanical condition, and it owes no 'inherent' (market-stigma) diminished value (Kieffer v. High Point Ins. Co., 422 N.J. Super. 38, 25 A.3d 1206 (App. Div. 2011)).

Source: Fanfarillo v. East End Motor Co., 172 N.J. Super. 309 (App. Div. 1980); Kieffer v. High Point Ins. Co., 422 N.J. Super. 38 (App. Div. 2011)

See which states allow diminished value claims.

Does your own insurance pay diminished value in New Jersey?

Short answer: Usually not. The claim is normally against the at-fault driver's insurer.

A claim on your own collision coverage depends on what your policy promises. Read its definition of "loss" and any exclusion for diminution in value before you ask. The New Jersey rule above is the starting point; your policy wording can narrow it.

How to file a diminished value claim in New Jersey

1. Finish the repair and get the final invoice showing every part and labor operation.
2. Document the pre-accident value of your exact trim and mileage.
3. Collect proof of the loss: a vehicle history report showing the accident, written trade-in offers, or an independent appraisal.
4. Send a written demand to the at-fault driver's insurer with a specific amount and your evidence.
5. If they refuse or lowball, you can sue the at-fault driver in small claims court before the deadline.

How to document the value before and after

• Before: save listings for cars of the same year, trim and mileage from just before the accident, and any records of options, upgrades and maintenance.
• After: get at least two written trade-in or purchase offers from dealers who see the repaired car and its history report.
• Keep the repair invoice, photos of the damage and the history report entry; they show what a buyer will see.

Step-by-step help with each part: how to file a diminished value claim.

Will the insurer use the 17c formula in New Jersey?

Many adjusters calculate diminished value by capping it at 10% of the car's value and then applying damage and mileage multipliers. The result is often a few hundred dollars. It is not based on what buyers actually pay, and you do not have to accept it. How the 17c formula works.

Deadline to file a diminished value claim in New Jersey

Short answer: You generally have 6 years to sue the at-fault driver for damage to your car (N.J.S.A. 2A:14-1). Send your written demand well before then.

Property damage claims in New Jersey generally must be filed in court within 6 years of the accident.

Source: N.J.S.A. 2A:14-1 (tortious injury to real or personal property)

How to file an insurance complaint in New Jersey

Short answer: File a free complaint with the New Jersey Department of Banking and Insurance online. It asks the insurer for a written response, but it cannot set the amount you are owed.

If an insurer ignores your claim or will not explain a refusal, the state insurance regulator takes complaints.