Diminished Value: Texans leaving thousands behind in vehicle accidents where they are not at fault

“That is something that insurance should be telling you,” - Auto Body Shop operator

Watch the video above to learn how you can earn money back after a crash

HOUSTON – Every single day millions get behind a wheel in Texas.

According to the most recent report by the Federal Highway Administration, there are 17.8 million drivers in the Lone Star State.

Yet, the vast majority have no idea of the significance of something called, “diminished value”.

It only comes into play after an accident, and plenty of them happen in Texas. In fact, according to the Texas Department of Transportation, one occurs every 56 seconds.

So why should you care about diminished value considering it is more than likely something you may not have heard of? The reason is simple, under the right conditions, if you are the driver who gets hit in an accident, you may be leaving thousands on the table even after the car has been repaired.

As KPRC 2 Investigates examined on Tuesday night, diminished value is the loss in a vehicle’s value after it’s been in an accident where there is damage. For example, if a car is valued at $50,000 and it gets hit, because of the accident the blue book value drops by $3,000. The $3,000 difference is the diminished value that a driver can ask for from the opposing insurance company.

“This is going to be a negotiation and if you don’t press for your side of it, you may not get it,” says Ben Gonzalez with the Texas Department of Insurance.

Texas is a state where drivers involved in accidents request compensation for the loss of their vehicle’s value.

Insurance companies do not go out of their way to tell victims about diminished value, according to multiple body shop experts KPRC 2 Investigates spoke with during our investigation. In fact, multiple well-known insurance carriers have no reference of it on their website.

“That is something that insurance (companies) should be telling you,” said Denise Maxwell with Collision Fix in northwest Harris County.

Maxwell believes there is a reason drivers are not told about diminished value following an accident.

“To me, the insurance company doesn’t want you knowing, and it’s better to keep you dumbed down so that way you know they are saving money in the long run,” Maxwell said.

Audrey Salazar learned of diminished value the hard way.

“The only way I found out about it is the fact that I got hit. Somebody at a body shop happened to mentioned it to me and I looked into it,” says Salazar the owner of Diminished Value and Associates.

Salazar says dealing with insurance companies is a case of David and Goliath, with the insurance companies knowing their position well.

“They very much realize that they are Goliath,” said Salazar.

Since 2018, Salazar has been assisting accident victims in navigating the challenging path of getting insurance companies to pay up.

“I would say on average 10% of what the actual diminished value is what the insurance companies are offering currently,” Salazar said.

According to Salazar, insurance companies do not want to pay the actual diminished value, which makes the process of getting fully compensated similar to a game of chance.

“Sometimes I like it to a crapshoot. And when you are talking about a large conglomerate like an insurance company, they typically win,” says Salazar who says requesting diminished value can be made up to two years after an accident.


The process can be lengthy. In Salazar’s case, it took six months to get her diminished value paid in full. According to every expert we spoke with, insurance companies don’t make it easy.

“It’s like they swat you away like a fly because they don’t want you to come back and negotiate a higher settlement,” said Salazar.

So what can a victim do when dealing with an insurance company that is not being responsive or lowballing a victim after a request for diminished value happens?

The Texas Department of Insurance is an option.

“When consumers call us and they are not getting what they want from the other party’s insurance, that is when we can step in,” said Gonzalez of TDI.

Gonzalez reveals that shortly after a complaint has been received, TDI can contact the company and ask them, “What are you doing about this?”

Texas Department of Insurance Diminished Value Complaints from 2016 to 2021. (KPRC)

Insurance companies who are not responding appropriately are of interest to TDI and are something the agency wants to know about. In the last five years, 614 drivers who made complaints received more money. The total amount? $1.2 million dollars, according to Gonzalez, which averages to about $2,000 per case.

There is no one size fits all formula, but those vehicles that are not older than five years and have less than 100,000 miles are the best candidates. A luxurious exotic vehicle worth tens or hundreds of thousand can be the exception. A driver cannot be fault and it must be requested. Since it’s a negotiation, keep a documented trail of all conversations with the insurance company. TDI views this as evidence and accepts it through their complaint portal on their website.

Denise Maxwell’s biggest piece of advice is, “Fight it. Fight it. Don’t give up. Do not let the insurance company win.”

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