Georgia auto property damage diminution of value claims
Georgia automobile insurance companies have been required since 2001 to "include an evaluation of diminution in value in its standard assessment of damages, just as it evaluates other elements of damage, and to adopt a suitable methodology for doing so." State Farm Mut. Auto. Ins. Co. v. Mabry, 274 Ga. 498, 556 S.E.2d 114 (2001).
In the past year or so a number of insurers have represented to claimants that they were using a formula approved by the Insurance Commission that set a definitive amount for valuation of diminution of value. That was incorrect.
Today the Insurance Commissioner is issuing a directive to insurance companies to "cease using any language which implies the Department has endorsed a particualr formula or method to determine diminution of value."
Instead, the Commissioner is informing insurance companies:
Effective immediately, any insurer disseminating information and/or appraisals to their insureds shall cease using any language which implies the Department has endorsed a particular formula or method to determine diminution of value. Specifically, any insurer disseminating information and/or appraisals to their insureds shall cease using any language which implies that the Mabry decision or any other requirement of the Department supports the proposition that the diminished value result obtained by a carrier’s use of a particular formula or method constitutes the definitive determination of the carrier’s liability to its insured. Any insurer not complying with this Directive will be subject to appropriate disciplinary action.
Ken Shigley represents plaintiffs in wrongful death and catastrophic injury cases, and in insurance bad faith cases statewide in Georgia. Recently elected Secretary of the State Bar of Georgia, he has been designated as a "SuperLawyer" in Atlanta Magazine and one of the "Legal Elite" in Georgia Trend Magazine. He is a Certified Civil Trial Advocate of the National Board of Trial Advocacy, and former chair of both the Southeastern Motor Carrier Liability Institute and the Georgia Insurance Law Institute.
Really! Good article.
I've used the formula before, when I was an insurance adjuster. The nice thing is that GA even has a statute. If I ever make it to the TN Legislature, I will propose that same statute in TN.
Did the Insurance Commissioner propose a formula?
My hat is off to Georgia's Insurance Commissioner. Like Georgia, West Virginia has a diminished value law on the books. Time after time insurers in this state have tried to push the 17c formula for calculating diminished value claims "because it has been approved" - the idea being if it is good enough for the courts in GA it should be easy to defend if need be in WV. It has been my experience that consumers leave a lot of money on the table when they accept an insurance settlement based on 17c.
They will if they don't know any better.
How do I access this on their web site to print a copy? It seems to get more user unfriendly every time it is updated.
