I have people ask me all the time… Ken, can you show me how to calculate diminished value? To do a proper appraisal, it takes research. Research most other appraisers are not eager to do. Actually, I’m not even eager to do it, but I know it has to be done in order to calculate the actual diminished value. There is no secret formula that works for all vehicles. In my opinion, Diminished Value Calculators are a joke. I’m sure the insurance companies love it when they see an “assessment” from an online Diminished Value Calculator. Most of these are either so low, that the insurance company jumps at the chance to pay it, or they’re so stupid that the insurance company voids the assessment. Either way, the claimant looses. Even though many take it as a “win”. Settling for $800, may sound good at the time, but if you found out later your claim was actually worth $8000, you’re not going to be such a happy camper.

To do a proper appraisal, it takes research

In order to accurately calculate Diminished Value, you need to know the vehicle, the local market and not only the amount of damage, but also the type of damage. There is no magic Diminished Value Formula. Though, the insurance companies wish there were. They tried with Formula 17C, which fails miserably at accurately computing diminished value. Especially on high end vehicles. There are some things a computer can’t do better than a human(at least not yet). Sometimes it takes industry knowledge that changes from day to day that computers can’t keep up with. But, more likely, a computer would probably get only a portion of the story. I can’t see how an instant DV calculator would even work. If I was a representative of an insurance company, I’d at least want to know what the formula was they based the calculation on.  And I haven’t seen anyone give that formula.

 There is no magic Diminished Value Formula 

That’s one reason we developed DiminishedValue.net. We wanted a way to help people to achieve a more accurate value at as low cost to the consumer as possible, while still producing a quality appraisal. Our appraiser is Ken Nix. Many online Diminished Value sites hide behind anonymity. Many aren’t even real appraisers. From the ex used car salesman, to the ex body shop estimator, to the ex auto damage adjuster, many have little to no experience in Vehicle sales or Valuations. So who’s standing behind those “free” and paid Diminished Value Calculators? We’re guessing no one since they don’t reveal their methodology, or have someone available to testify. We like to start the process sometimes before a body shop starts work on it if at all possible as you may be better off producing a preliminary assessment and pushing to have the vehicle totaled. Most Diminished Value calculators work strictly from a computer program, with no actual market comparables. They’re not USPAP compliant and if you settle with one of their reports, you could have probably settled without it for the same amount. According to several insurance reps we speak to, there have been more Diminished Value Claims filed in the past 12 months, that there have been in the past 4 years combined. So insurance companies will be scrutinizing each assessment or appraisal.

 There is no magic Diminished Value Formula 



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