Disclaimer: This article is for educational purposes only and does not constitute legal advice. Consult a qualified attorney to discuss your specific situation.
Detailed Answer
Under New Mexico law, you may recover the diminished market value (DMV) of your vehicle from a negligent driver’s insurer or from your own carrier if uninsured or underinsured. No statute prescribes a fixed formula for DMV, but courts and insurers rely on industry standards and professional appraisals. The key steps are:
- Establish Pre-Accident Value. Research your vehicle’s fair market value immediately before the crash. Use resources like Kelley Blue Book, NADA Guides or local dealer offers. Document the make, model, year, mileage and condition.
- Document the Accident and Repairs. Preserve photos of damage at the scene and before/after repairs. Obtain a detailed repair invoice listing parts replaced, labor hours, paint codes and any structural repairs. Keep all estimates and receipts.
- Obtain a Professional Appraisal. Hire a certified auto appraiser experienced in DMV. They typically use the ‘‘10% rule’’ method recognized by many insurers:
- Multiply the pre-accident retail value by 10%.
- Apply a damage multiplier (0.00–1.00 based on severity).
- Adjust for mileage (0.00–1.00 based on odometer reading).
The result approximates your diminished market value. A written appraisal report strengthens your claim in negotiations or court.
- Submit a Claim. Present your documentation and appraisal to the at-fault party’s insurer. Under New Mexico’s Unfair Practices Act, insurers must handle claims in good faith. See N.M. Stat. Ann. § 59A-16-20 (Unfair practices). If your own insurer denies uninsured or underinsured coverage, request an explanation in writing.
- Consider Small Claims Court. If negotiations fail, you may file in the New Mexico Magistrate Court (Small Claims division) for claims up to $10,000. See N.M. Stat. Ann. § 35-11-2. Prepare your appraisal, estimates and a simple affidavit of damage.
Relevant Statutes and Regulations:
- N.M. Stat. Ann. § 59A-16-20 – Prohibits unfair claim practices by insurers. nmlegis.gov
- N.M. Stat. Ann. § 35-11-2 – Jurisdiction of magistrate courts (small claims). nmlegis.gov
Helpful Hints
- Start documenting immediately: take clear photos of all damage and note weather, traffic and road conditions.
- Get at least three independent pre-accident valuations to support your baseline value.
- Choose an appraiser accredited by the International Society of Appraisers or USPAP compliant.
- Keep a centralized folder—digital or paper—with every estimate, invoice, email and letter related to your claim.
- Review your insurance policy’s definitions and exclusions—some policies cap or exclude DMV recovery.
- Be ready to negotiate: insurers often open with low offers. Refer them to your professional report and statutory duty of good faith.