More New Software. Diminished Value Calculator

March 3, 2010 by
Filed under: Collision Repair Industry 

I have had many requests from people wanting to buy my diminished value calculator software separately from my BodyShop Office suite. And one of the most popular keyword searches that bring people to this site is “Diminished Value Calculator.” So here it is. I’ve finally created a separate application.

In the days of Wreck Check, diminished value was a mystery revealed only to those willing to spend $10,000 on software and franchise licensing. It’s really not that complicated. My apologies to any DV professionals who may be offended by that statement.

The truth is, there is a very predictable depreciation to vehicles damaged in an accident. I learned this quickly while working for the dealership, Secor’s Auto Center, years ago. People would wreck their cars and then want to trade them in after they were repaired. I saw first hand the hit they took from diminished value and discovered the formula to for determining DV. Actually, there exists several formulas.

I first created my Diminished Value Calculator several years ago when I released BodyShop Office, my body shop management software. The DV calculator was, and still is part of that management system. As mentioned above, I received many requests to break it out into a separate application. I’ve done just that. Here is a screen shot of the software.

Screen shot of DV Calculator. Everything is done from this page. Click to see full sized image.

 Like all my software, ease of use is built in. Most of the information can be filled in by using the EMS feature of your estimating software. The more information you enter when writing an estimate, the less you have to enter when writing a DV report. Just fill your company information in at the top center of the screen, browse to your EMS folder and all extracted estimates will fill the list box in the upper left corner.

Check a few boxes and calculate the diminished value. Then you can choose to print the report or email it right from the same screen. Here is a sample report.

Sample Diminished Value Report. Click to see full size image.

The report is a simple and concise, one page report. It couldn’t be easier. Remember, this is for Inherent DV, or the psychological DV caused by the accident regardless of how well the damage was repaired. DV due to improper, incomplete or incompetent repairs is something different. That is something only a professional appraisal can determine, but there is a place to enter that figure in this report, along with an explanation that any estimate will be attached.

Download the software and try it free for ten days. If you like it you can purchase a registration number, if not uninstall it.

Now every shop can afford to give their customers a DV report with their estimate or final bill.

Visit the DV page to download or purchase the Diminish Value Calculator.

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Comments

13 Comments on More New Software. Diminished Value Calculator

  1. FIRMIN TROYE (TROY) on Tue, 16th Mar 2010 11:11 am
  2. SORRY,,,,,BUT YOUR CALCULATIONS ARE (AT A MINUMUM) 50% OFF, ON THIS SUBJECT VEHICLE,
    THE MINUMUM DV WOULD BE BETWEEN $7,000.00 – $9,000.00 OR HIGHER.
    PLEASE CHANGE YOUR PROGRAM AS IT WILL ONLY SERVE THE INS. INDUSTRY. THEY WILL USE IT AGAINS’T US HONEST DV PROFESSIONALS.

    THANK YOU
    F. E. TROYE

  3. John Shortell on Tue, 16th Mar 2010 4:03 pm
  4. Give me the details of the vehicle and the repairs so I can see what you are talking about.

  5. Justin Petty on Mon, 10th Jan 2011 9:55 pm
  6. John,

    I disagree with Troye. I came up with $3750.00 on the subject vehicle in the samples you listed on your site. I agree that inherent diminished value is grossly overstated by most DV professionals, and grossly understated by insurance carriers. Who would have thunk it.

    I will say that your report does not comply with USPAP standards which I find is very helpful when defending your methods and credibility in determining diminished value. I also would say that without having evidence of stellar repair, great maintenance records, and photos of the vehicle which reflect the condition, then the report would also hold little power to persuade me. It was pretty close to my calculation, though, was it a fluke? A BMW might suffer a 35% loss in the trade in value where a Ford Taurus would lose 18%. Market research on the specific vehicle is required, and I don’t see a market listing anywhere on yours. NADA is a pretty good guidepost, but I use at least 5 sources to get a solid value and I incorporate sales date on actual vehicles which have been sold in the relevant market area. Anyway, I’ll be keeping an eye on your program to see how it fares.

    Justin Petty

  7. Craig A on Mon, 12th Dec 2011 11:10 pm
  8. John, What can you tell me about the NADA mileage classifications. I have searched NADA’s site and can’t seem to find definitions for this. I am looking at your demo, and just want to make sure I am using it properly.

    Thanks, Craig

  9. John Shortell on Wed, 14th Dec 2011 5:26 pm
  10. You have to get a copy of the NADA guide. Most dealers have old copies.

  11. Paul Pham on Wed, 14th Mar 2012 10:18 pm
  12. Dear John ,I am working and enjoy your demo , My question is How do I kown the
    insurance Company they approve the report. by the way we figure through the software. Thanks.

  13. Justin Petty on Thu, 15th Mar 2012 9:13 am
  14. Paul,

    You can rest assured that most insurance companies will not accept the report as proof of lost value. Although John has made it easy for estimators to get a number for a DV demand, I would challenge anybody to show me a paid DV claim where the evidence used was a report from this calculator. I won’t be holding my breath on that one. I know from experience and hundreds of litigated cases, that if there is not a real live trained expert that can pass Daubert or Frye standard available to testify and produce a real appraisal based on accepted methodology (like USPAP), then it is unlikely you will see any reasonable settlement offer from an insurance company. Even when an expert is involved, most insurance companies wait until a trial is eminent and then they settle at the 11th hour to avoid creating any precedence when they lose a jury or bench trial.

  15. Paul Pham on Fri, 16th Mar 2012 9:13 pm
  16. dear Justin Petty
    Please let me know ,what type of the license qualify to do the DV in the state
    of Texas.If I really want to get in this Type of Business What and how can I ? right
    now I am an estimater for a body shop ,and I deal with my customer everyday, please let me know may be I can work with you .

  17. Billy Walkowiak on Mon, 23rd Dec 2013 2:37 pm
  18. You can’t use a formula. The only way to do a DV Assement is to know the vehicle and know who repaired it make and model play a big role. Structural vs Cosmetic. If you use a formula you might as well send it to the insurance companies they will manipulate it and make a generic one size fits all. It’s not practical, different regions have different total loss laws and NC Law requires your report any damage over 25% when selling or trading. Is all that in you formula? I get results based on market knowledge! No formula can do that. http://collisionsafetyconsultants.com/

  19. Justin Petty on Tue, 8th Sep 2015 7:11 am
  20. Do you think any insurance companies will use this software, and if not, why?

  21. Steven Paul on Thu, 10th Nov 2016 6:55 am
  22. I agree with most everyone else on this comment thread. While this program provides a rough idea of the actual diminished value this report will never stand up in court. It has been my experience as a vehicle appraiser that only USPAP formated appraisal reports are honored and accepted by insurance & finance companies and the court system.

  23. Wayne Toloso on Sun, 3rd Mar 2019 11:39 am
  24. John,

    I have to say you are the FIRST person I have heard bring up the origination that began with the body shop only ‘Wreck Check’ program ……. I was a PDA Franchisee (two offices) when this came about …… I later became a PD manager in Texas and have dealt with being on BOTH sides of this argument, I also Managed a Chrsyler/Dodge Dealer Shop for 8 yrs I have been on Shop or Insurance side since 1991 and have seen a lot of different approaches ….

    I agree with Billy that you have to know shops…. see the vehicle ….. see if the bolts were dusted etc… etc.. …. as a PD Manager (Texas) I would receive all sorts of reports from out of state from people whom had not even seen a photo of a repaired vehicle and they were determining DV …. I am an Independent now (semi retired ) I have been focusing more and more on DV at lawyers (yes some are actual friends) and friends requests after losses… I know the Georgia rule issues and all the arguments for and against …… I never accepted reports when an inspection and photos were not included and every DV was negotiable …….. I personally do not think we will ever have a decisive program to conclude DV in each case …. this is truly an area where the Appraiser needs to be experienced in all parts of the industry from repair as a technician or shop estimator ….. as an Insurance (IA or Staff) Appraiser and definitely with some knowledge Adjusting files or Negotiating with attorneys ….. to many of these claims are used today to circumvent the PD payout since the BI side is so determined now by doctor visits and the and meds cost …..

    I am now providing actual inspections for attorneys and individuals in my area (Louisiana now )

    My opinion is that this will always be, as repairing a vehicle has always been, an unfortunate result of peoples status of believing Insurance companies are simply banks waiting to pay them for their ‘LOSS’ (not to diminish the actual physically harmed people _ I have had my share of accidents … motorcycle and auto) I have actually reported NO DV to attorneys and their jaws dropped (some shops are very particular) ….. I really think it would be time to come up with a credible process including software like yours to determine DV

    Just food for thought …… I am in the middle and think it is good for both sides to have access to people who can shed light on what is and is not causing the value of a vehicle to be diminished if the repairs are proper…..

  25. Justin Petty on Mon, 11th Mar 2019 9:18 pm
  26. Calculating diminished value is no different than calculating value. When one wants to know the value of property, they get an appraisal. Trying to come up with a “new” way to figure value is only helping the insurance industry to confuse the real matter. It is just VALUE, and the preferred method for determining the value of property is a formal appraisal. The only published appraisal standards guide that has been approved by anyone of any consequence is the USPAP. This is the guide that appraisers should look to when attempting to develop and report upon the value of a vehicle. If an appraiser follows the USPAP, then their results should reflect a credible value, and any other appraiser that conducts the appraisal using the same USPAP method should arrive at a result that is very similar in value.

    There are established rules for developing and producing appraisals, and there are established rules for qualifying expert witnesses, evidence, and testimony.

    I can assure you that staff defense counsel for insurance carriers around the US, have, will, and do mislead claims handlers as to the reality of what is valid evidence. They lie and tell adjusters that there is no way to determine lost value, and that the vehicle has to be sold before any loss is “realized” and that they must use 17c because that is the industry formula. . . ALL LIES ! ! !

    The sad fact of the matter is that the vast majority of DV claims fall in small claims court (mostly under $10K), and because of this, the quality of the experts suffers. Most experts (or their reports) that I have dealt with would not qualify as a true auto appraisal experts if challenged under the equivalent of the FRE 702 and / or the Daubert or Frye standards for experts, and the huge differences in experts’ opinions of DV is testament to the lack of true expertise in consistent auto appraisal development and reporting.

    Even after losing multiples times at jury trials in the same court, the same insurance company will continue to deny DV claims supported by an appraisal from the same expert that the court approved and validated in the last case. Because small claims courts are not courts of record, a judgment there does not set any precedence, so carriers just try their luck as an economic bully stick. The majority of people will not sue for diminished value unless there is an injury that is tied to it that is not settling. Attorneys don’t like to help with property damages because there is not enough money there. With the average DV claim being less than $3500.00, it is a battle that requires resolve of both the expert and the victim.

    I show up to court and do not charge any witness fee, just to prove a point.

    It’s market research that will lend you the correct numbers on diminished value claims. No formula or program can ever determine when or how the market or perception of consumers will change.

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