Diminished value

What states allow diminished value claims?

Layer 1: claiming against the at-fault driver

A third-party diminished value claim is a claim for property damage the at-fault driver caused. Your repaired car is worth less than an identical car with a clean history, and that remaining loss is part of the damage from the crash. On that basis, the claim is available in principle in every state.

Available in principle is not the same as automatic. No state bans the claim outright, but the burden of proving the loss is yours. Insurers will test the evidence: how severe the damage was, how the car was valued before and after, whether the market support is specific to your car or just a generic formula, and whether the repair record matches the claim. Outcomes vary with that evidence, from claim to claim, even inside the same state.

That is the honest version of the all-states answer. A list that simply says yes everywhere, without the proof burden, promises more than any driver can rely on. Build the evidence first, and treat the state question as settled for this layer: the fight is usually about proof and value, not about whether the claim exists.

Layer 2: claiming against your own policy

A first-party claim is a different legal question. Here you are not claiming damage another driver caused you — you are asking what your own contract with your insurer promises to pay. Most collision policies are written to repair the car or pay its value on a total loss. That wording is commonly read to exclude a separate payment for diminished value after a proper repair, and courts in most states have upheld that reading.

Georgia is the famous exception. In State Farm v. Mabry, decided in 2001, the Georgia Supreme Court required insurers to assess diminished value on first-party claims. Georgia drivers making a first-party claim should ask their insurer, in writing, how diminished value was assessed on their claim.

A small number of other states have addressed the first-party question in case law or regulation, in one direction or the other. This guide does not name them, deliberately: summaries of those rulings age quickly, are easy to oversimplify, and can point you to the wrong conclusion for your policy and your facts. Your state insurance department and your own policy wording are the reliable sources for your state.

Which state's rules matter for your claim?

In practice, the rules that matter are the ones governing where the claim is filed and handled — typically connected to where the accident happened and the state of the policy involved. Crashes across state lines, and policies written in a different state from where you live, can make that question less tidy than it sounds.

Do not guess at it from a national article. If the accident state and your policy state differ, ask both insurers, in writing, which state's law and department they are treating as governing your claim, and keep the answers. If the answers conflict, your state insurance department is the place to raise that conflict.

One other state rule matters on every claim, whichever layer you are in: time. Statutes of limitations differ by state and by claim type, and missing a deadline can end a claim regardless of its merits. See How long do I have to file diminished value? and check the deadline for your specific claim early, not after negotiations stall.

How to check your state in three steps

1. Read your policy's collision wording. Look for what the policy promises to pay for damage to your car, and any language about repair, like kind and quality, or actual cash value. That wording is the starting point for any first-party question.
2. Search your state insurance department site for diminished value. Use the department's own search or a general search limited to that department's site. Look for consumer guides, bulletins, or complaint guidance that use the term directly.
3. Ask the insurer for its position in writing. Ask whether it will assess diminished value on your claim, under which coverage, and on what basis if it says no. Keep the written reply with your claim file.

Frequently asked questions

Is diminished value allowed in every state?

As a third party claim against the at-fault driver insurer, diminished value is recoverable in principle in every state, because it is part of the property damage that driver caused. No state bans the claim outright. You still have to prove the loss, and the strength of your evidence affects the outcome.

Why do people say some states do not allow diminished value?

They are usually talking about first party claims against your own collision policy. Most policies are written so first party diminished value is not covered, and courts in most states have upheld that reading. That is a different question from claiming against the at-fault driver insurer, where the claim is broadly available.

What is special about Georgia?

Georgia is the famous exception for first party claims. In State Farm v. Mabry in 2001, the state supreme court required insurers to assess diminished value on first party claims. That rule is specific to Georgia. For other states, check your policy and your state insurance department rather than relying on a general list.

How do I check the rule in my state?

Start with your policy collision wording, then search your state insurance department site for diminished value, and then ask your insurer for its position in writing. Keep the reply. Those three steps tell you more about your actual claim than any national summary, because the answer depends on claim type, policy, and state.