Car Insurance Claim in New Jersey
Reader’s Question:
I heard about this diminished value of a car after an accident from someone here in New Jersey. Are car insurance companies responsible for the diminished value if the policyholder files a car insurance claim?
Paul
Passaic, NJ
The discussion about diminished value has been in frenzy for years since majority of car insurance policies were mum about the subject matter whether car insurance companies are responsible for any or believed decrease in car’s value after an accident, even if the car has been fixed to its pre-accident condition. Car insurance companies fight that diminished value would not be covered, but policyholders don’t agree. And there have been a lot of court cases in which the policyholders battle with their car insurance companies about diminished value compensation.
However, the Insurance Services Office or ISO, the agency that gives insurance forms and data, has written a policy language that car insurance companies could now use in 45 states (New Jersey included) and Washington, DC that legitimately takes car insurance companies not liable for diminished value compensation in bodily damage coverage car insurance claim. In some cases, auto insurance policies work this way — the ISO puts forward sample property or casualty guidelines to state insurance departments all over the US that make it easier for car insurance companies to change and simplify their car insurance policies. A number of state insurance departments should authorize the report of the ISO prior to a car insurance company taking on any guidelines suggested by the ISO.