Short answer: Diminished value is the drop in a car's resale value after an accident, even after good repairs. Whether an insurer pays it depends on the state and on whose policy you claim under. In the states below, regulators or statutes say diminished value is generally not owed under your own repair-or-replace coverage but may be part of a claim against the at-fault driver, and North Carolina adds an appraisal process for disputes.
Diminished value claims usually come up after a not-at-fault accident, when you claim against the other driver's liability insurance.
The table
| State | Rule or regulator position | Third-party / process notes | Source |
|---|---|---|---|
| Idaho | Department of Insurance: the insurer isn't obligated to pay diminished value unless the policy says otherwise | The department can't determine your car's value; for disputes it suggests talking to an attorney | Idaho DOI, Common Auto Claims Questions |
| Kansas | Insurance Department: in most cases diminished value is excluded from your own (first-party) coverage by policy language, and Kansas has no statutory requirement to pay it | If another party is liable you can present the claim under their policy. There's no set formula, so you need to support and document the amount you claim; estimates of lost value can vary a lot | Kansas Insurance Department, Auto Insurance Shopper's Guide |
| Kentucky | Regulation: for a third-party car claim, damages are measured as the difference between the car's fair market value right before and right after the loss, reduced by the other party's share of fault, if any | Repair estimates or appraisers' reports may be used to show that difference. For your own (first-party) claim, damages follow your policy and don't include any measure not specifically provided in it | 806 KAR 12:095 §7(2) |
| Louisiana | Statute: when another party negligently damages your car without destroying it, you can recover the loss in market value as additional damages if you prove that, even repaired to pre-loss condition, it would be worth less than before | Total recovery can't exceed the car's pre-damage fair market value, and the diminished value paid counts toward whether the car is a total loss under R.S. 32:702. This is a third-party claim; your own policy's terms govern first-party claims | La. R.S. 9:2800.17 |
| Maine | Bureau of Insurance: Maine has no specific law on paying diminished value; the state's high court held a repair-or-replace policy doesn't cover it | Loss in value might be part of a third-party claim against the at-fault driver's insurer | Maine Bureau of Insurance, Auto Claims FAQ |
| Maryland | Insurance Administration (Bulletin 24-8, April 2024): the required uninsured/underinsured motorist coverage must cover diminished value, subject to UM/UIM limits, on the same terms as property damage liability | Maryland case law treats loss of market value after repairs as recoverable from an at-fault driver in addition to repair costs; UM/UIM property damage coverage also includes loss of use | Maryland Insurance Administration Bulletin 24-8; Md. Ins. § 19-509 |
| Massachusetts | Division of Insurance: a diminished value claim under your own policy isn't covered | Against the at-fault driver it depends on the policy edition: under the 2008 standard policy it may be recoverable if you prove it; under the 2016 standard policy the insurer isn't required to cover inherent diminished value, though the at-fault party could be held responsible | Mass. Division of Insurance, Auto Claims FAQ |
| North Carolina | Liability policies must offer appraisal when you and the at-fault driver's insurer disagree on the drop in fair market value and the gap exceeds $2,000 or 25% of pre-accident retail value, whichever is less | Each side picks a licensed appraiser within 20 days of a demand; an umpire resolves disagreements; either side may reject the umpire's report within 15 days | N.C.G.S. §20-279.21(d1) |
| Texas | TDI's position: under your own collision or comprehensive coverage, the insurer isn't obligated to pay diminished value once the car is completely repaired to pre-damage condition | An insurer may owe loss of market value on a third-party liability claim, or under your UM/UIM coverage, regardless of repair | TDI Bulletin B-0027-00 |
| Washington | Insurance Commissioner: typically you file a diminished value claim against the at-fault party's insurer, not your own; some policies don't cover it | It isn't paid automatically; you must prove with documentation that the car's market value dropped even after repair | Washington OIC, Filing an auto insurance claim |
We list only states where we read the official text ourselves in October 2026. A state that is missing is not covered here; check that state's statute or insurance department.
How to support a claim
- Know which policy you're claiming under. Third-party (the at-fault driver's liability) claims are where loss of value is most often recognized in this table.
- Document the car's condition before the accident with service records and photos, and get the repair invoice.
- Get an independent valuation from a licensed appraiser or dealer.
- Check your state's rules. See the state insurance rules hub.
Download and embed
- CSV: diminished-value-claim-rules-by-state.csv
- Embed: copy the iframe code in `embed-snippet.html` and keep the source link.
Methodology
Each row was read from the official source linked in the Source column in October 2026. This is general information, not legal advice. See also the state insurance rules hub.
Frequently asked questions
Does my own insurance pay diminished value?
Often not. Texas's insurance department says an insurer isn't obligated to pay it under your collision or comprehensive coverage once the car is fully repaired, and Maine's Bureau of Insurance says a repair-or-replace policy doesn't cover it.
Can I claim diminished value from the at-fault driver?
In most states in this table, regulators or statutes indicate loss of market value may be part of a third-party liability claim. North Carolina provides an appraisal process for large disagreements.
What is the North Carolina diminished value appraisal rule?
If you and the insurer disagree on the drop in fair market value by more than $2,000 or 25% of the pre-accident value, whichever is less, the policy must allow appraisal (G.S. §20-279.21(d1)).
Alishahi Insurance · 439 N Canon Dr, Penthouse, Beverly Hills, CA 90210 · (877) 711-4545 · CA License #4348151. General information only. Not legal, tax or financial advice, and not a coverage determination. Coverage depends on policy language and underwriting, and rules vary by state.