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Texas insurance glossary

Diminished value

Diminished value is the amount a vehicle is worth less after an accident than it was worth before it, even once the repair has been completed properly.

Sources checked

The idea is simple and the recovery is not. It is normally raised against the at-fault driver’s property damage liability coverage rather than against the claimant’s own policy, and whether it is payable at all turns on the policy wording and on the facts of the particular loss.

A repair history is now visible to any buyer through a vehicle history report, which is what makes the loss real rather than theoretical. It is largest on newer vehicles and on vehicles carrying a title brand.

This site does not state how a particular claim will be decided. That is a question for the adjuster handling it and, where it is disputed, for a Texas attorney.

Sources: TDI — automobile insurance guide (CB020); TDI — replacement cost or actual cash value. Verified .

A definition, not legal advice and not a quote. Rules and figures change; confirm your own situation against the source named above, or with us, before you act on it. Last checked .

See also

  • Property damage liability Property damage liability is the part of an auto policy that pays for damage the insured driver causes to other people’s property, most often another vehicle.
  • Salvage title A salvage title is the Texas ownership document for a vehicle damaged badly enough that its repair cost approaches its value, or brought in on an out-of-state salvage document.
  • Rebuilt title A rebuilt title is the Texas title issued for a salvage vehicle that has been repaired and inspected, branded so that the history stays with the vehicle.
  • Collision coverage Collision coverage pays to repair or replace the insured’s own vehicle after it hits another vehicle or an object, or overturns, whoever was at fault.

Where this is handled

Knowing what a coverage is called is not the same as knowing what is on your policy. One independent agency can read your declarations page with you and compare the markets that will write your record.

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