17c Diminished Value Formula

This is the formula insurance companies use to calculate diminished value. It consistently produces a lowball estimate and has no established validity or outside authority. Your actual diminished value will probably be far more than what this formula produces, but write down this number, as many insurance companies will use this formula.

The value of your car in dollars according to sources such as Kelly, Edmunds, or NADA.
The mileage of your car. Please note: the formula does not allow for mileage over 100,000.
The amount of cosmetic and structural damage your car has suffered.
The insurance company will likely come up with a lowball offer around this number.

Actual Diminished Value

Shows your actual diminished value. This is what the insurance company should pay you for your claim. This formula is very simple, but requires some work on your part. You must go to KellyEdmunds, NADA, or your local car dealer and get evidence for two numbers:

  1. the value of your car before the accident
  2. the value of your car after the accident


The difference is your actual diminished value. It will almost certainly be much more than what the insurance company will offer to pay, so the extra effort will most likely be worthwhile.

The value of your car in dollars before the accident, gotten from sites like Kelley Blue Book, Edmunds.com, or NADA.
Find the value your car can be sold for after an accident has occurred, using dealership quotes or appraisal.
The Diminished Value of your vehicle is the difference between its value before an accident, and after an accident.

What do I do now?

This depends on the results of the formulas. There are two basic situations:

1. If both the 17c Diminished Value Formula and the Actual Diminished Value formulas give very small numbers, then you have to ask yourself if it’s worth the time and expense to pursue a claim.

2. If the Actual Diminished Value number is much higher than the 17c Diminished Value Formula, then the insurance carrier will probably make you a low offer for your diminished value claim.