Quick definition — what is diminished value?

Diminished value is the reduction in a vehicle’s market value after it has been damaged and repaired following a collision. Even when repairs are high quality, buyers often pay less for a vehicle with an accident history. A diminished value claim seeks money to compensate for that lost resale value.

Who can seek diminished value in Tennessee?

Generally, the vehicle owner (or lienholder with an interest) can demand diminished value from the at-fault driver’s insurer. If your insurer paid your repairs and sought reimbursement from the other insurer, you may still have a right to pursue a separate diminished value claim, depending on the facts and your contract with your insurer. Tennessee’s insurance oversight body can help if you believe an insurer is not following applicable rules: Tennessee Department of Commerce & Insurance (TDCI).

Step-by-step process to get a reliable diminished value quote

1. Document the basics immediately.
   • Record the vehicle’s VIN, year, make, model, trim, mileage at the time of the loss, and current mileage.
   • Take clear photos of pre-accident condition (if you have any), post-accident damage, and final repaired condition.
   • Keep the police report, repair estimates, and all repair invoices and parts receipts.
2. Understand the type of diminished value you need quoted.
   • Immediate diminished value (loss in market value right after the crash, before repairs).
   • Repair-related diminished value (loss after repairs because the vehicle has an accident history or structural repairs).

   Most consumers seek the post-repair market-value loss, because repairs do not always fully restore market perception.

3. Choose how to get a quote: informal estimate vs. professional appraisal.
   • Free or low-cost online calculators and dealer estimates can give a rough idea, but they are often imprecise.
   • Independent diminished value appraisers provide a formal written report that insurers respect more than a generic online number. Expect to pay an appraisal fee (commonly $150–$500 depending on vehicle and complexity).
4. Hire an experienced appraiser or qualified vehicle appraiser.
   • Look for appraisers who provide a written market-value analysis and explain their method (comparables, pre-loss value, repair impact, and market adjustments).
   • Ask for sample reports and references. Confirm whether the appraiser will testify in court or small-claims hearings if needed.
5. Provide the appraiser with full documentation.

   Give the appraiser the VIN, current and pre-accident mileage, repair invoices, photos, vehicle history report (e.g., CARFAX), and any maintenance records that show the pre-loss condition.

6. Receive the written diminished value report and quote.

   A professional report typically explains the vehicle’s pre-loss market value, how the loss was calculated, comparable sales used, and the final diminished value figure. Use this report to demand payment from the at-fault insurer.

7. Send a demand to the at-fault insurer.
   • Include the appraiser report, photos, repair bills, and any documentation showing market value before the crash.
   • Be clear that you are requesting payment for diminished value. Keep copies and send by a traceable method (email if accepted, certified mail, or both).
8. Negotiate or escalate.
   • Insurers may accept, reduce, or deny the claim. Use the appraiser’s report to support negotiations.
   • If the insurer denies without reasonable grounds, you can file a complaint with TDCI (file a complaint), pursue small-claims court, or consult an attorney to evaluate litigation options.

What to expect from a diminished value appraisal

A credible appraisal will:

• State the vehicle’s pre-loss fair market value (using comparable sales).
• Explain how the accident and repairs reduce buyer willingness and market price.
• Provide a clear dollar figure and an explanation of the method used (comps, market data, structural concerns, etc.).

Insurers look for reasoned, documented numbers. A shallow one-line estimate is unlikely to get full consideration.

Costs and timing

Appraisal fees vary by provider and vehicle complexity. Expect a turnaround of a few days to a couple weeks depending on documentation and the appraiser’s workload. Start the process promptly — evidence (photos and market comps) is strongest soon after repairs.

Common roadblocks and how to handle them

• Insurer says “we paid to repair, so no further value is owed.” Response: Repairs restore physical condition but not market perception. Provide comparables and an appraisal to show loss in resale value.
• Insurer disputes pre-accident condition. Response: Present maintenance records, photos, and vehicle history reports.
• Difference between Tennessee insurer practices and other states. Response: Tennessee regulates insurers through the Department of Commerce & Insurance. If you suspect unfair handling, consult TDCI resources: https://www.tn.gov/commerce/insurance.html.

Helpful hints

• Collect evidence immediately: photos, police report, repair invoices, and mileage records.
• Get at least one independent appraisal. A professional report strengthens negotiation power.
• Ask the appraiser for a market-comparable report — insurers respect comparables-based valuations.
• Keep repair receipts and parts lists; aftermarket parts or structural repairs can increase diminished value.
• Be polite but firm when dealing with insurers. Put demands in writing and keep copies of every communication.
• If the insurer denies without explanation, you can file a complaint with TDCI: File a Complaint.
• Consider small-claims court for smaller amounts; confirm the local claim limit with your county clerk.
• If you’re uncertain about legal deadlines or complex denials, consult an attorney experienced in Tennessee auto insurance claims or property damage.