Diminished value claims in Maryland

Who can claim diminished value in Maryland

• Third-party claim: if another driver caused the crash, post-repair loss in value is part of the property damage owed by that driver and claimed from their liability insurer.
• First-party claim: your own collision coverage pays under your policy's terms, which usually promise repair or actual cash value. A separate diminished-value payment is generally not part of that promise.
• Fault decides everything in Maryland. Under contributory negligence, a driver who contributed to the crash at all can lose the third-party claim entirely, so the police report and any witness or video evidence matter more here than in most states.

Maryland deadline: 3 years (Md. Code, Cts. & Jud. Proc. § 5-101)

Maryland's general rule gives three years from the date the claim accrues to file a civil action, unless another statute sets a different period. For vehicle damage from a crash, count three years from the crash date.

Fault: Coleman v. Soccer Ass'n of Columbia, 432 Md. 679 (2013)

Contributory negligence: if your own negligence contributed to the crash, you are generally barred from recovering. Maryland's highest court declined to abandon this rule in 2013, leaving any change to the General Assembly.

How Maryland law treats diminished value

The leading Maryland case is Fred Frederick Motors, Inc. v. Krause, 12 Md. App. 62, 277 A.2d 464 (1971). The court explained that the usual measure for a damaged but not destroyed vehicle is the reasonable cost of repair, and that an owner who proves the car is still worth less after repairs can recover that remaining loss in market value on top of the repair cost, provided the two together do not exceed the drop in value before repairs.

That cap is a practical ceiling worth checking: repair cost plus diminished value cannot be more than the difference between the car's value just before the crash and its value in damaged, unrepaired condition. For most repairable cars the cap is not reached, but on an older car with a large repair bill it can be.

Krause makes proof the whole game. A Maryland adjuster will expect evidence of what your car is worth with a reported accident compared with an identical clean car, so build the file around the repair invoice, the history report, and comparable listings from the Baltimore, Washington suburbs, Frederick and Eastern Shore markets.

Because of contributory negligence, an insurer may deny a Maryland DV claim outright by arguing you were partly at fault, rather than discounting it. Answer that with evidence on fault first, then value.

How insurers value a totaled car in Maryland

Maryland has a dedicated total-loss regulation, COMAR 31.15.12, and it is broader than most: it applies to total-loss claims under collision, comprehensive, uninsured motorist property damage and liability property damage coverage. That means it also governs a total loss claimed against the at-fault driver's insurer.

Under COMAR 31.15.12.04, a cash settlement must be at least either the retail value of a substantially similar vehicle from a recognized valuation manual or a database producing statistically valid values, or a dealer quotation for a substantially similar vehicle at a location reasonably convenient to you, plus applicable taxes and transfer fees in either case. A substantially similar vehicle must be the same make and model, the same or a newer year, have at least the same major options, be in similar or better condition, and have mileage within the greater of 4,000 miles or 10 percent of yours, with exceptions for limited-production, specialty and older vehicles.

The settlement offer must tell you that, on request, the insurer will give you in writing the method and sources used, a detailed calculation including options, all deductions, and the inspection guidelines it relied on, and the insurer must respond within 7 business days of your request (COMAR 31.15.12.05). The offer must also tell you that you may reject it in writing and make a counteroffer. Complaints go to the Maryland Insurance Administration.

The appraisal clause in Maryland

Most Maryland auto policies include an appraisal clause for disputes about the amount of a covered physical-damage loss under your own coverage. Each side appoints an appraiser, an umpire decides points they cannot agree on, and the result fixes the amount but not whether the loss is covered.

The appraisal clause is part of your own policy. It does not control a diminished-value claim against another driver's insurer, which turns on Maryland damages law and, first, on fault.

What else matters in Maryland

• Maryland District Court small claims cases cover claims up to $5,000 (Cts. & Jud. Proc. § 4-405). Many diminished-value claims fit within that limit.
• Many Maryland drivers commute into neighboring states and the District of Columbia. If the crash happened across the line, that jurisdiction's deadline and fault rule may apply instead of Maryland's, so check before relying on the dates on this page.
• Use the COMAR 31.15.12.05 request rights early. A written request for the valuation method, comparables and deductions starts the 7 business day response clock and gives you the insurer's numbers to answer.