In many cases, when a driver causes a crash, they are legally responsible for various damages, expenses, and losses that accident victims incurred. This is true for damaged property, too. In addition to paying to repair the vehicle damaged in the crash, they may also be responsible for additional costs, including loss of use, total loss, and diminished value claims.
If your vehicle sustains substantial damage or was a total loss following a crash, you may want to discuss your options for seeking additional related losses with a car accident attorney. They can answer your questions and help you understand what financial recovery could be available.
What does the Insurance Company Have to Pay for Property Damages?
An insurance company’s obligation to pay a claim for damage to someone’s vehicle comes from an auto liability insurance policy. Most states with a fault-based auto insurance system require these policies. They provide coverage for accident victims, paying out the amounts the policyholder would be responsible for if they do not have insurance.
While this often includes medical care coverage, lost wages, pain and suffering, and other damages, there is also a range of costs related to property damage. This includes:
- Loss of use of the vehicle
- Towing fees
- Storage fees
- Diminished value
- Lost profits caused by loss of use of the vehicle
- Other consequential damages that the vehicle owner can prove
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What Is a Total Loss, and How Much Should I Get for It?
The amount that an insurance company will pay for damage to a vehicle is limited. It does not have to pay more than the vehicle’s actual cash value in question. However, when the repair costs and the vehicle’s value in its damaged state begin to approach what the car was worth just before a crash, the insurer may consider it a total loss.
The rules on when this occurs depend greatly on state law. For example, under La. Rev. Stat. § 32:702, Louisiana’s definition of a “total loss” is when a car’s damages equate to more than 75 percent of its market value as the most current National Automobile Dealers Association Handbook determines.
What Is ‘Loss of Use’?
Loss of use differs from total loss. These damages arise when someone cannot use their vehicle because of accident-related property damage that needs repair. In most cases, victims can recover monetary damages for the loss of use of their crashed car or the reasonable rental car costs associated with their accident.
The Mississippi Supreme Court affirmed loss of use payments in 1952 in Vining v. Smith. Another case, Poindexter v. Southern United Fire Ins. Co. in 2003, illustrated how this works clearly. In this case, the claimant requested compensatory damages of more than $7,000. This included:
- $3,000 for repair or replacement of the truck
- $4,000 for loss of use, towing, and storage fees
The insurance company deemed the truck a total loss, but it was put into storage, where he began accruing fees. Because of the negligent driver who caused the crash, the claimant did not have a truck to drive to run errands, go to work, or take care of other tasks. He and his attorney demanded payment for loss of use, and the court agreed.
What Is a Diminished Value Claim?
In some cases, a vehicle may not be worth as much as before a crash, even after repairs. This is known as “diminished value.” This is sometimes also called depreciation or diminution in pre-tort value. Each state’s laws about diminished value claims differ, including whether they are allowable and how to calculate the diminished value.
It is important to note that if the repairs make the vehicle the same as before it was damaged, only the cost of repairs can be recovered. This vehicle would not have a diminished value because of the collision.
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Who Can Help when I’m Trying to Recover Damages After a Car Accident?
A car accident law firm can help you understand the potentially recoverable damages after a crash. When your vehicle sustains severe damage and requires time-consuming and costly repairs, you may be able to recover other related damages.
It is especially crucial to work with an attorney if you suffered other damages, as well. This could include a medical assessment, treatment, lost wages, or other expenses or losses.
Speak with an Attorney from Morris Bart, LLC
You can talk to a car accident attorney from the Morris Bart law firm for free today. We provide complimentary consultations to help you understand your situation and legal options. We are also here to protect your rights as you seek recovery.
We serve clients in four Gulf South states, including Louisiana, Alabama, Arkansas, and Mississippi. Call (800) 537-8185 to discuss your crash claim with one of our lawyers today.
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