How Much an Accident Devalues a Car
One of the main factors a person considers when purchasing a used vehicle is if it was ever involved in an accident. Some people will not buy a used car that has been in a wreck. For others; however, knowing the vehicle was previously involved in an accident can be a negotiating tool.
Vehicles repaired after an accident will have a diminished value, regardless of how well the repairs were made. VINsmart will teach you how much an accident can devalue a car.
Why Does the Value of Your Vehicle Decrease After a Wreck?
The main reason a vehicle price decreases after an accident is the increased potential for problems with the vehicle at a later time. Even with the best repairs, some damage from accidents may not occur immediately, and driving a vehicle formally in an accident will always carry that risk.
When an insurance company evaluates a vehicle after an accident, it will determine if it is repairable or totaled. A totaled vehicle costs more to repair than the value of the car. The damage is not considered too extensive if the insurance company agrees to repair the vehicle. It is important to know how much an accident devalues a car.
However, just because the visual damage is not extensive does not mean there are no additional problems. Many vehicles after an accident will drive differently. The frame may be jarred to a different position, or the suspension may not ride the same. There may also be other minor issues that have not yet come to light with the vehicle.
The average drop in the value of a vehicle is 20 percent after an accident.
The value of the vehicle can drop even more if a licensed repair shop does not perform the repairs. Repairs made by the car owner themselves cannot be guaranteed, which can significantly decrease the vehicle’s value.
Will an Insurance Company Pay for Diminished Value?
When you make a claim against your insurance policy for a car accident, it will not cover the vehicle’s diminished value. These policies cover repairs and personal injuries.
If you have a rare or collectible vehicle, you can try to negotiate with the insurance company to cover some of the diminished value. However, unless you have special coverage for this type of expense, it will be very rare that the insurance company will cover part or all of the loss in value you have experienced.
How Would a Buyer Know That My Car Was Damaged?
When selling a used vehicle, it may be tempting not to disclose that the vehicle was previously in an accident, especially if the repairs have made the vehicle look brand new. However, the buyer will find out when they pull a vehicle history report, and failing to disclose this information may lead to losing the sale.
On the other hand, you could run the vehicle history report and turn it into a selling point. Even with a previous accident on record, when you provide a vehicle history report with your vehicle, you can prove that the car was professionally repaired.
Additionally, the history report will show maintenance performed on the vehicle, recalls, and when these repairs were made, and will provide ownership details on the car. You can use this report to show that the vehicle has never been totaled, has a clean title, and has never been a part of a flood or natural disaster.
A vehicle history report can show that the vehicle has never been stolen. It can provide the buyer with details on where the car has been registered since it left the dealership as a new vehicle. It can also prove that the odometer is accurate.
These things can help you secure the best price for your used vehicle, even if it has been in an accident.
When Purchasing Any Used Vehicle
When you are purchasing a used vehicle, asking about any prior accidents should be at the top of your list. Accidents can impact value, and there is potential for problems with the vehicle in the future.
If you can, always take the used vehicle to a certified mechanic for an evaluation if you know it has been in an accident before purchasing. Always get a vehicle history report if you are purchasing a used vehicle from anywhere other than a certified used car dealership. These history reports can give you all the information you need to make an informed decision about your purchase.
Accidents do happen, and this does not mean that you cannot get many more years of service from a vehicle after it has been repaired. However, it is your right as a buyer to know that the accident happened and where the repairs were made. One of the best ways to find out this information is to get a vehicle history report on any vehicle you are considering buying. Once you review the history, you will know if the vehicle is right for you.
When Purchasing a Vehicle
Always remember to run a VINsmart report on any used vehicle before making a purchase. A VINsmart report runs a complete history on the vehicle including whether it has ever been reported as stolen, involved in a major accident, or listed as a totaled vehicle.
VINsmart reports will also give you a registration history and mileage at registration. It reports any significant incidents related to the vehicle, such as being involved in a fire or flood.
When purchasing a used vehicle, the best way to ensure you make a good purchase is to know the vehicle’s complete history.