Kentucky
Diminished Value Overview
In Kentucky, 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, Kentucky 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. Kentucky is considered a diminished value state with recognized case law supporting recovery.
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01
Statute of Limitations
Kentucky allows two years from the date of the accident to pursue a diminished value claim.
02
Third-Party Claims
Diminished value claims can be pursued against the at fault driver’s liability insurance when another driver caused the accident.
03
First-Party and Uninsured Motorist
Most first party policies in Kentucky do not cover diminished value, and uninsured or underinsured motorist coverage does not apply to diminished value claims.
04
Small Claims Court Limit
Kentucky small claims court allows diminished value claims up to $2,500.
Kentucky Diminished Value Law
Kentucky law recognizes that property may suffer a loss in market value that remains even after repairs are completed. When another party is at fault, that loss may be recoverable as part of a third party property damage claim.
Muncie v. Wiesemann, 2018 Ky. LEXIS 257 (Ky. 2018)
The Kentucky Supreme Court held that stigma damages, meaning a remaining reduction in market value after repairs, are recoverable when repairs alone are insufficient to make the injured party whole. The court recognized that if residual loss in value is not compensated, the property owner would suffer a permanent loss without full recovery.
Although this case involved real property, Kentucky courts apply the same fundamental damage principles to personal property, allowing recovery for diminished value when repaired property remains worth less in the open market.