There you are, minding your own business, obeying the laws of traffic when CRUNCH! Someone has crashed into your vehicle. What should have been a lovely drive home from work has just turned into a massive inconvenience.

Hopefully the accident is just a little fender bender; your car will be in the shop for a day or two, and then life as you know it will return to normal. But what if that’s not the case? What if the damage to your vehicle, or even to you or your passengers, is more extensive than that?

Who Pays For Repairs?

If you’re hit in an accident, the at-fault party’s auto insurance company is responsible for getting your vehicle back to pre-accident condition by making any necessary repairs. It’s the job of the at-fault party’s insurer to indemnify you, or to make you whole again.

Basically, you have a right to be compensated by their auto insurance company for any loss that was incurred, up to the insured’s policy limits. Obviously, that means that your vehicle will either be returned to pre-accident condition, or you’ll be given a check in the amount of its market value.

What Auto Insurance Covers

However, even if your vehicle is restored to its pre-accident condition, it may not be restored to its pre-accident value. In other words, if you were to sell your vehicle, you may receive less money for it simply because it now has an accident in its history, especially if that was its first and only accident. This is called “diminished value.”

Diminished Value of a Car…AFTER an Auto Accident

Where Does Compensation Come From?

If you are in an accident and the other person is responsible for the collision, you may be able to collect compensation for diminished value from their insurance company as part of the claims process. Note that because diminished value is almost impossible to prove, however, it may be a challenge to actually receive any compensation.

It’s also important to note that in most states, including Nevada, you cannot collect diminished value from your own insurance company. In fact, your insurance policy may specifically state that you are not entitled to compensation for diminished value. So, even if it could theoretically be proven that your car is indeed worth less than it was prior to the accident, you would not be entitled to a payout from your insurer.

My Vehicle Is a Total Loss; How Much Money Will I Get?

Getting into a car accident is a huge interruption to your life, but finding out that your car will no longer be drivable? That’s worst-case scenario. Sadly, many people who find themselves in that unfortunate situation feel doubly blindsided when they hear the settlement amount for their totaled vehicle.

You had a working vehicle prior to the accident, and you’ve read that the insurance company is supposed to get it back to pre-accident condition. Why then, isn’t your “total loss” settlement enough to purchase a comparable vehicle?

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That’s Not What My Car Is Worth!

Will the settlement be enough to buy the same car? Car collisions are inconvenient in and of themselves, but finding out that your vehicle is a total loss may feel like an even bigger headache. So how much money can you expect to get when your vehicle is totaled?

What Affects The Value Of Your Vehicle In A Total Loss?

First of all, it’s important to remember that your settlement check reflects the actual value of your vehicle, not the replacement value. Note that this is not the same amount as what a car dealership, whose mission is to make a profit, would sell your vehicle for off their lot. For that reason, your settlement amount may or may not be enough to replace your car with one that is the same make and model.