Arizona Diminished Value Claims
How Diminished Value Claims Work
In Arizona, a vehicle involved in a not at fault accident may lose market value even after repairs are completed. When another driver is responsible for the accident, Arizona law allows you to pursue compensation for that loss in value from the at fault driver’s insurance company as part of your property damage claim. An Arizona diminished value claim allows you to recover the difference between what your vehicle was worth before the accident and what it is worth after repairs. Arizona is considered a diminished value state, meaning this right is recognized under state law. For a more detailed explanation of diminished value claims, drivers can explore our Arizona diminished value guide.
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01
Statute of Limitations
Arizona allows two years from the date of the accident to file a diminished value claim.
02
Third-Party Claims
You can pursue a diminished value claim in Arizona when another driver is at fault and submit it against that driver’s liability insurance.
03
First-Party and Uninsured Motorist
Arizona does not recognize diminished value under your own first party policy, and neither uninsured nor underinsured motorist coverage applies to diminished value.
04
Small Claims Court Limit
Arizona small claims court allows cases up to $5,000.
Arizona Diminished Value Law
Arizona law recognizes that a vehicle may suffer a loss in market value after a collision even when repairs are properly completed. When another driver is at fault, that loss may be recovered as part of a third party property damage claim.
Farmers Insurance Co. of Arizona v. R.B.L. Investment Co., 138 Ariz. 562, 675 P.2d 1381 (Ariz. Ct. App. 1983)
The Arizona Court of Appeals acknowledged that compensation for a negligently damaged motor vehicle may include both the cost of repair and any proven residual reduction in fair market value.
Oliver v. Henry, No. 1 CA CV 10 0701 (Ariz. Ct. App. 2011)
The court reaffirmed that when personal property is damaged but not destroyed, damages are measured by the difference in the vehicle’s value immediately before the damage and its value after the damage. When a vehicle is repaired, this measure may include repair costs as well as any remaining loss in value after repairs are completed.
The court further held that Arizona law does not require a vehicle owner to sell or transfer a damaged vehicle in order to establish a diminished value claim. A loss in value occurs at the time of damage and may be proven through competent evidence, including expert appraisal of the vehicle’s pre loss and post repair market value.
Arizona Diminished Value FAQs
Below are answers to common questions about Arizona diminished value claims, including how claims work, time limits, and how loss in market value is calculated after an accident.
Does Arizona allow diminished value claims?
Yes. Arizona permits third party diminished value claims against the at fault driver’s insurance carrier.
Can I file a diminished value claim in Arizona if I was not at fault?
Yes. Arizona follows a fault based system, meaning the responsible driver’s insurer may owe compensation for market value loss.
Can I pursue diminished value against my own insurance in Arizona?
Typically no, unless your policy specifically provides first party diminished value coverage.
How is diminished value calculated in Arizona?
There is no official Arizona formula. Insurers often use internal valuation methods. Premier uses VIN specific market comparison data to measure real world resale impact.
What is the statute of limitations for diminished value in Arizona?
Arizona generally allows two years for property damage claims.
Do insurance companies pay diminished value in Arizona?
Yes, but supporting documentation is usually necessary to secure compensation.
Still have a question?
Because Arizona borders several states, accidents near state lines can involve different diminished value rules. See how claims are handled in California, Nevada, New Mexico, and Utah.