When I make diminished value claims for clients, I am sometimes told by the insurance adjuster that in Ohio they do not owe to pay for diminished value claims. This response still amazes me. I then have to have a discussion with the adjuster about what the law actually is in the State of Ohio. So I thought it would be a good idea to put a short post together summarizing the law in Ohio as it applies to diminished value claims.
OHIO CASE LAW – Rakich v. Anthem Blue Cross & Blue Shield
The law in Ohio was recently clarified by a Court of Appeals case called Rakich v. Anthem Blue Cross & Blue Shield, 2007-Ohio-3739. In that case the owner of a car that had been damaged in an accident sued in order to recover the diminished value their car had sustained. The Court of Appeals held that a person may recover the residual dimunition of value in addition to the cost of repair in Ohio, and that the measure of the damages in a diminished value claim is the difference between the value of the vehicle immediately before the accident, and the value of the vehicle immediately after repairs are completed.
SECOND RESTATEMENT OF TORTS
Furthermore Ohio has adopted the Second Restatement of Torts, which states:
When one is entitled to a judgment for harm to chattels not amounting to a total destruction in value, the damages include compensation for
(a) The difference between the value of the chattel before the harm and the value after harm or, at his election in an appropriate case, the reasonable cost of repair or restoration, with due allowance for any difference between the original value and the value after repairs, and
(b) The loss of use.
Clearly the Second Restatement of Torts requires that allowance be paid for the difference in value between the car’s value before the accident and after repairs are completed.
DIFFERENCE BETWEEN 1ST AND 3rd PARTY CLAIMS
Please understand that the law I have summarized here has to do only with third party insurance claims for diminished value, not first party claims. A third party claim is a claim against a negligent person who has damaged your vehicle when they caused the accident. When you pursue a third party claim, you are making the claim against the at fault person’s insurance company. First party claims are those you make under your own policy, they are claims like comprehensive and collision claims. Generally, you pay no deductible under a third party claim like you usually do under a first party claim.
When it comes to first party claims, your insurance company may owe you a diminished value settlement as well, but this depends on how your insurance policy contract reads.
If an insurance adjuster for the negligent driver tells you that they do not owe to pay for diminished value claims in Ohio, they are wrong. At McKenzie & Snyder we are ready to help you fight the insurance company for your diminished value claim.
DISCLAIMER – This blog post is intended for general information purposes only, does not give legal advice, and does not create an attorney client relationship. None of the comments or responses are intended as legal advice, do not create an attorney client relationship, and are not protected by the attorney client privilege. You should consult an attorney for advice regarding your individual situation.
Written by Sam Warden