Diminished Value Claims: Arkansas
If your vehicle was damaged in an accident in the state of Arkansas and underwent repairs, its resale value is likely to be less than what it was before the crash. This loss in market value is known as diminished value, and it is recoverable in Arkansas through a diminished value claim filed with the at-fault party’s insurance company. If the other driver was uninsured, you can also file a diminished value claim with your own insurance company.
Summary – Arkansas Diminished Value Claims
Statute of Limitations: 3 years
Third Party Diminished Value Claim: Yes
First Party Diminished Value Claim: No, most insurance policies will exclude diminished value
Arkansas Property Damage Minimum Limits: $25,000 in coverage
Uninsured Motorist Coverage for Diminished Value: Yes, insurers are required to offer UMPD, but it can be rejected in writing if you don’t want the coverage. $25,000 in uninsured motorist property damage per accident. It includes coverage for hit and run drivers with physical contact between the vehicles.
Underinsured Motorist Coverage for Diminished Value: Yes, this coverage pays when you’re struck by another party who does not have sufficient liability coverage to pay for all of your damages.
Arkansas Small Claims Court Limit: $5,000, Attorney representation is not allowed, appeals are permitted.
Arkansas Diminished Value Law
Arkansas is a diminished value state with reported case law supporting your legal right to diminished value compensation.
MFA Ins. Co. v. Citizens Nat. Bank of Hope 545 S.W.2d 70 (1977)
If repairs do not substantially restore vehicle to its former condition and value, the proper measure of damages is the difference in value before the accident and after the accident and repairs.
How to File a Diminished Value Claim in Arkansas
Step 1. Proof of loss. It’s your responsibility to prove the repaired vehicle is worth less than before the accident. Quantifying how much less a buyer would be willing to pay can be done by an appraiser that specializes in diminished value.
Step 2. File a diminished value claim. By filing a diminished value claim through the at-fault party’s insurance company, you can get back your car's lost value following an accident. The sooner you file your diminished value claim, the better. Submit the appropriate documents for review (diminished value appraisal and demand letter).
Step 3. Negotiate a settlement. Because diminished value claims are complex, it’s important that you work with a professional auto appraiser who has expertise in these matters. The more documentation you have, the more you might experience success when making a claim.
If you have any questions, please call us at 704-209-7629 or complete a free estimate form to get further assistance with your Arkansas diminished value claim.