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MSJC rules insurers must pay for loss of value

On Behalf of | Oct 25, 2021 | Motor Vehicle Accidents

When one is involved in a motor vehicle accident, there are so many issues that pop up. Whether it is medical bills, repair costs, lost works, etc., the problems seem never ending. But, one aspect that many forget is that when a vehicle is involved in an accident, it loses some value. And, the Massachusetts Supreme Judicial Court recently found that this inherent loss of value must be compensated for after car crashes.

The unanimous decision

The MSJC, Massachusetts’s highest state-level court made their ruling Tuesday. In the unanimous decision, they gave our state’s drivers the ability to sue for costs beyond auto-repair costs. This means that insurance companies can be found liable for not just those repair costs, but also the value of the vehicle that was lost as a result of it being involved in the auto accident, i.e., the diminished market value that results from the car accident.

What does diminished market value mean?

Essentially, if there are two vehicles that are the same make, model and year, with the same mileage, they should both be sold for about the same amount of money. However, if one of those vehicles has been in a crash, the one that was in a crash will fetch less, sometimes, significantly less money. For owners, this means that when we trade in a vehicle after a car accident, we will get less money for our new car. It is this difference that the MSJC now says accident victims should be compensated.

What was this based on?

In personal injury and all tort cases, the law tries to put the victim in a position as nearly as possible to their position before an accident. In other words, the lawsuit after a car accident is attempting to make the accident victim whole and compensated for what they lost as a result of the car accident. This is why those accident victims are entitled to this additional compensation because to make them whole, they should be able to recover for that diminished market value.

What does this mean for car accident victims?

For North Andover, Massachusetts, motor vehicle accident victims that have already received compensation for their crash, they likely do not have any additional rights from this holding. That is because, most of the time, when a settlement is reached, it is a full settlement of all rights. Though, one should contact their personal injury attorney to make sure. But, for those that are injured after this rule, or victims who have not yet settled, make sure this is factored into a settlement or included in the lawsuit.

 

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