Detailed Answer
Diminished value represents the difference between a vehicle’s market value immediately before and after an accident or loss. In New Jersey, you can seek compensation from the at-fault party’s insurer or, in certain cases, your own insurer. Below are the steps to submit a diminished value claim under New Jersey law.
Step 1: Determine Your Claim Type
Under New Jersey law, you must file your claim against the at-fault driver’s insurer as a third-party claim. Your own insurance policy typically covers actual repair costs, not diminished value, unless you purchased an optional diminished value endorsement.
Step 2: Gather Supporting Evidence
- Pre-accident market value: Obtain a vehicle valuation report (e.g., Kelley Blue Book).
- Post-repair appraisal: Hire a qualified auto appraiser to estimate diminished value.
- Repair documentation: Collect itemized repair bills and photographs of damage.
- Vehicle history report: Secure a Carfax or similar report showing accident disclosure.
Step 3: Draft and Submit Your Claim Package
Create a cover letter addressed to the at-fault insurer that includes:
- A clear statement requesting payment for diminished value
- Claim number or accident details (date, location, parties involved)
- All supporting documents listed above
Send your claim via certified mail with return receipt to ensure proof of delivery. Keep copies of everything.
Step 4: Reference Relevant New Jersey Statutes
While there is no specific diminished value statute, you can rely on New Jersey’s claims handling regulations and consumer protections:
- N.J.S.A. 39:6A-8: Insurance payment for property damage
- N.J.S.A. 17:29B-4: Unfair claim settlement practices
Step 5: Negotiate or Dispute
If the insurer undervalues or denies your claim, you can:
- Submit an internal appeal with the insurer
- Request appraisal or mediation if your policy includes an appraisal clause
- File a complaint with the New Jersey Department of Banking and Insurance
Step 6: Consider Legal Action
In New Jersey, the statute of limitations for property damage claims is two years from the date of loss (N.J.S.A. 2A:14-2). You may file in small claims court (up to $3,000) or the Law Division of the Superior Court for higher amounts.
Disclaimer: This information is for educational purposes only and does not constitute legal advice.