Michigan Diminished Value Claims
How Diminished Value Claims Work
In Michigan, vehicles involved in an accident may suffer a loss in market value even after proper repairs are completed. However, Michigan’s no fault insurance system significantly limits how diminished value may be pursued.
Michigan law does not require insurance companies to pay diminished value as part of standard no fault coverage. Instead, recovery for vehicle damage that is not covered by insurance, including diminished value, may be pursued under Michigan’s mini tort statute when another driver is at fault.
As a result, Michigan diminished value claims are not handled through typical third party insurance claims and are generally resolved through the courts rather than directly with an insurance carrier.
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01
Statute of Limitations
Michigan allows three years from the date of the accident to pursue a mini tort property damage claim.
02
Third-Party Claims
Michigan does not permit traditional third party diminished value claims against the at fault driver’s insurance company. Instead, diminished value may be pursued as part of a mini tort claim against the at fault driver when the loss is not otherwise covered by insurance.
03
First-Party and Uninsured Motorist
Most first party auto insurance policies in Michigan do not provide coverage for diminished value. Uninsured and underinsured motorist coverage generally applies to bodily injury and does not extend to diminished value claims.
04
Mini Tort Recovery Limit
Michigan’s mini tort statute allows recovery of up to $3,000 for vehicle damage not covered by insurance, including diminished value where applicable. Claims are typically pursued in small claims or district court.
Michigan Diminished Value Law
Michigan is a no fault state, which significantly limits third party property damage claims, including diminished value. However, Michigan law does allow recovery for vehicle damage not covered by insurance through the state’s mini tort statute when another driver is at fault.
Michigan Compiled Laws § 500.3135
Mini Tort Property Damage
Michigan’s mini tort statute allows a vehicle owner to recover up to $3,000 for vehicle damage not covered by insurance when another driver is at fault. This recovery may include diminished value where the repaired vehicle has suffered a loss in market value that is not otherwise compensated.
To recover under the mini tort statute, the claimant must establish that the other driver was at fault and that the claimed damages were not covered by insurance. Claims are typically pursued through small claims or district court.
Important Michigan Limitation
Michigan law does not require insurance companies to pay diminished value as part of standard no fault insurance coverage. As a result, diminished value claims in Michigan are generally limited to mini tort recovery and are subject to the statutory cap.
Michigan Diminished Value & Mini Tort FAQs
Below are answers to common questions about Michigan diminished value claims, including how claims work, time limits, and how loss in market value is calculated after an accident.
Does Michigan allow diminished value claims?
Michigan generally does not allow traditional diminished value claims because of the state’s no fault insurance system. Property damage claims between drivers are handled differently than in most other states.
However, drivers may still pursue limited recovery through Michigan’s mini tort law, which allows a vehicle owner to seek reimbursement from the at fault driver for certain vehicle damage expenses not covered by their own insurance policy.
Can I file a diminished value claim in Michigan if I was not at fault?
In most situations, no. Michigan’s no fault system prevents drivers from pursuing traditional diminished value claims against the at fault driver’s insurance company.
Instead, Michigan law allows a mini tort claim, which allows the vehicle owner to recover a limited amount of money from the at fault driver for vehicle damage expenses that are not covered by their own insurance.
Can I pursue diminished value against my own insurance in Michigan?
Generally no. Most Michigan auto policies do not provide coverage for diminished value.
Your own insurance policy may still cover the cost of restoring the vehicle depending on your coverage, such as collision insurance. Any recovery beyond that is typically limited to the mini tort process.
What is the statute of limitations for Michigan mini tort claims?
Michigan generally allows three years to pursue a mini tort property damage claim against the at fault driver.
Do insurance companies pay diminished value in Michigan?
No. Traditional diminished value recovery is generally not available under Michigan’s no fault system.
However, drivers may still pursue compensation through the mini tort process for certain vehicle damage expenses caused by the at fault driver.