Diminished Value in Michigan

After a collision, even if your vehicle is repaired to like-new condition, its market value may still be lower than it was before the accident.

That loss in market value is called diminished value. In Michigan, diminished value claims are limited because state law does not require insurers to pay diminished value as part of a regular claim.

How Diminished Value Is Treated in Michigan

Michigan does not mandate that insurance companies pay diminished value as part of an ordinary property damage claim.

Instead, your primary recourse for an economic loss such as diminished value is through Michigan’s mini tort statute, which allows recovery of up to $3,000 from the at-fault driver or their insurer when a third party is responsible for the accident.

The mini tort statute generally must be invoked within three years of the accident.

What Diminished Value Means

Diminished value is the difference between what your vehicle was worth immediately before the accident and what it is worth after repairs.

Even if repairs restore safety and appearance, a vehicle’s accident history often makes it worth less in the marketplace.

When Diminished Value Claims Are Possible

• Your vehicle was damaged in an accident caused by another driver
• The accident reduced the vehicle’s market value
• You can demonstrate that reduction with evidence such as appraisals or market data
• Your claim is pursued within Michigan’s time limits

Michigan Mini Tort Recovery

In Michigan, diminished value is most commonly pursued under the state’s mini tort statute, which allows a maximum recovery of up to $3,000 for property damage, including loss of value, when another driver is at fault.

This recovery is separate from your own collision coverage and is designed to compensate out-of-pocket losses not covered by your own policy.

Challenges With Diminished Value in Michigan

Because Michigan does not require insurers to pay diminished value in typical claims, pursuing this loss often depends on mini tort procedures or direct negotiation with the at-fault insurer.

Evidence such as independent appraisals and market comparables can strengthen your position in demonstrating actual loss.

Need Help Evaluating Diminished Value in Michigan

EstiVerify can help assess whether diminished value may apply to your situation and explain how the mini tort process intersects with your overall claim strategy.

Related topics: Michigan Repair Rights | Michigan Total Loss