Quick answer

If your vehicle was damaged in an accident, you may be able to recover the vehicle’s lost market value (called diminished value) in addition to repair costs. In Minnesota you can press a diminished value claim against the at-fault driver’s insurer (third-party claim) and sometimes through your own insurance depending on your policy. The claim process involves documenting pre-accident value, repairs, and loss in market value; submitting a demand with supporting evidence; negotiating; and, if necessary, using appraisal procedures or filing suit.

Detailed Answer: Step-by-step process under Minnesota considerations

1. What is diminished value?

Diminished value is the difference between your car’s market value immediately before the accident and its market value after the repairs. Two common types are:

• Inherent diminished value—the loss in resale value because the vehicle has an accident history even if repaired well.
• Repair-related diminished value—value lost because repairs were incomplete, used inferior parts, or damage remains visible.

2. Who can you claim against?

Third-party claim: If another driver was at fault, you can seek diminished value from that driver’s liability insurer as part of your property damage recovery. This is the most straightforward route.

First-party claim: If you use your own collision coverage, whether diminished value is paid depends on your policy terms and insurer practices. Some policies cover only the cost to repair or replace, not separate diminished value; others and some insurers may compensate for diminished value. Review your policy and ask your insurer directly.

3. Evidence you will need

Gather the following to support a diminished value demand:

• Photos of the vehicle before and immediately after the accident and of repairs.
• Complete repair invoices showing parts, labor, and whether original equipment manufacturer (OEM) or aftermarket parts were used.
• Pre-accident value proof (comparable sales, NADA, Kelley Blue Book, local listings).
• An independent diminished value appraisal or report from a qualified appraiser that explains the methodology and arrives at a dollar figure.
• Vehicle history report (e.g., CARFAX) showing the accident entry.
• Insurance claim number, police report (if available), and correspondence with insurers.

4. Typical steps to pursue the claim

1. Promptly document the scene and damage. Take photos, keep invoices, and obtain estimates before and after repairs.
2. Notify the appropriate insurer. For a third-party claim, contact the at-fault driver’s liability carrier. For a first-party claim, notify your own insurer if you plan to use your policy.
3. Get a professional diminished value appraisal. A formal report strengthens your demand and explains the calculation (comparable sales method, cost-to-cure, or other accepted approaches).
4. Prepare a written demand. Include all documentation: photos, repair bills, pre-accident valuations, the appraiser’s report, and your requested amount.
5. Negotiate. Insurers commonly respond with a settlement offer. Be prepared to counter with your documentation and reasoning.
6. If negotiations stall, use contract remedies. Many policies include an appraisal clause or independent appraisal/umpire procedure. For third-party claims, Minnesota civil court or small claims court may be options if the dollar amount fits the venue limits.

5. Practical tips about valuation and appraisals

Appraisers typically look at pre-accident retail value versus post-repair retail value using comparable sales and local market conditions. A high-quality, well-documented appraisal citing comparables and market data is much more persuasive than a generic online estimate.

6. Timing and deadlines

You must act within the time allowed by insurance policy notice requirements and any applicable statute of limitations for property damage claims. These deadlines can vary. Provide prompt notice to insurers and start the appraisal or demand process soon after repairs are complete.

7. If the insurer refuses to pay

If the at-fault insurer denies the diminished value claim or offers an amount you consider unreasonable, you can:

• Request a written explanation of the denial.
• Use the appraisal or dispute resolution procedures in your policy (if applicable).
• File suit in civil or small claims court to recover property damage including diminished value.
• Contact the Minnesota Department of Commerce for consumer assistance about insurance practices: mn.gov/commerce/industries/insurance/consumer/.

8. Realistic expectations

Not every claim for diminished value will produce a large recovery. Factors that reduce or eliminate diminished value include a very low pre-accident value, high mileage, prior damage history, or market conditions. On the other hand, newer cars with low mileage and strong resale markets often show clearer diminished value losses.

9. Where to learn the law and how to proceed

For the governing statutes and procedural rules in Minnesota, start with the Minnesota Statutes and the state’s insurance consumer pages:

• Minnesota Statutes (searchable)
• Minnesota Department of Commerce – Insurance (consumer help)

If your claim is time-sensitive or the insurer’s position is complex, consult a Minnesota-licensed attorney who handles auto property damage. An attorney can explain deadlines, analyze your evidence, and advise whether to accept a settlement or file suit.

Helpful Hints

• Take photos at the scene and again before any repairs, including detailed shots of damage and VIN/license areas.
• Keep all receipts, repair estimates, and communications with insurers organized in one file.
• Get an independent diminished value appraisal if the expected loss is more than a few hundred dollars—this often pays for itself in negotiation.
• Compare multiple sources for pre-accident value (Kelley Blue Book, NADA, local listings) and save screenshots or printouts.
• Obtain a vehicle history report to show the accident will appear on records potential buyers consult.
• Ask the at-fault insurer for their valuation method and challenge any figures that lack documentation.
• If you make a first-party claim and your insurer repairs the vehicle, preserve pre-repair photos and insist on written documentation of the repairs performed.
• Consider small claims court for lower-value disputes—procedures are generally simpler and faster than higher courts.