All You Need to Know About Diminished Value
The primary reason an individual would need to calculate the diminished value of a car is to submit an insurance claim after an accident. If the car can no longer run or has undergone major damages, it is considered not worth much. It does not matter who is at fault and responsible to reimburse you for the value of the car, it is still in the best interest of the insurance company to calculate the lowest possible value of the vehicle in question. You will find that most of the insurance companies use a concept known as 17c to arrive at the monetary value of the car.
After an accident, you will benefit more from a higher diminished value number here and this is the reason why it is important to know how the insurance company arrives at this number. If there is a large discrepancy in the calculation of the numbers, then you must be able to negotiate for a better deal. First, you need to learn how to use the formula that the insurance companies use to determine the diminished value. The sales value of the car must be determined. The market value of the car is the amount that NADA determines. You must keep in mind however that the worth of the car changes depending on the state you are located as well as other factors.
For you to calculate the worth, you need to know the make and model of the car, mileage and the extent of damage. The next step you need to do is apply the 10% cap to the value. Multiply the value at which you will have arrived at through NADA by the 10%, which usually sets the maximum amount the insurance company can pay out. For more info about diminished value, visit https://www.youtube.com/watch?v=JaLtPrEFFd8.
The next step is to apply a multiplier for the damage. This multiplier adjusts the amount that you will have arrived at in the last step depending on how much your car has been structurally damaged. You will notice that this does not take account the mechanical damages of the car. It only considers the replacement of parts and car repairs. There are numbers attached to the level of damage that you will choose according to your own judgment. Lastly, deduct more value for the mileage on the car. There are also numbers attached to this and you will choose the appropriate one of your car to arrive at the final diminished value of the car, visit website here!