Monday, August 3, 2015

Is my car worth less after an accident?

It really depends on a number of factors.  

The technical term for this loss is accelerated depreciation (in Canada) and diminished value (in the US)

Here are a five factors:

  1. Severity  - The final cost to repair a car doesn't always signify substantial damages.  You have to dig deeper than the total final cost.  We have seen a Porsche that had $11,000 brake rotors.  You really need to understand the damages.
  2. Structural damage?  Understanding if a vehicle has sustained structural damage is a bit more of a complex situation.  Structural damage is more than just frame damage. In today's age of Unibody construction, there is more than just the frame rails to consider.  Good body shops will go through the repairs to explain if there was any structural damage.
  3. The market - Depending on the market, an accident may or may not have an impact.  If you have a mass produced vehicle that has sustained damages of $10,000 it may be more difficult to sell, due to supply and demand.  A 2012 Dodge Grand Caravan with a $10,000 may be more difficult to sell due to the supply and demand.  If there are 500 of these vehicles for sale in the exact same color / option combination then why would a buyer pay the same for a previously damaged version.
  4. Confidence - Confidence plays a large role when determining how much a car is worth.  If your vehicle is damaged and you do not understand the damages, it will be difficult for most to sell. Putting the damages into context is an important part of maintaining your vehicle's value. Understanding the breakdown of the repairs is always important.  Some insurance companies will include the cost of the vehicle rental into the total cost of repairs.  In some instances, this can be upwards of $1000. 
  5. Quality of repairs - If the repairs are apparent, it may be more difficult to sell a vehicle for top dollar.  Is it not only the responsibility of the body shop completing the repairs to return the vehicle to pre-accident condition, it is your responsibility as well.  It is unfortunate when accidents occur and it is even more frustrating when the accident was not your fault.  But you still need to do what you can to mitigate any losses.  Making sure the body shop repairs your vehicle properly is ultimately your responsibility.  If your body shop will not fix the vehicle properly, there are ways to involve the insurance company to get your car fixed.
If you've been in an accident and you need help, feel free to give us a call.  We are here to help!


Wednesday, July 1, 2015

Accelerated Depreciation / Diminished Value FAQ

Accelerated depreciation FAQ

What is accelerated depreciation?

Accelerated depreciation, also known as "diminished value", is what happens to a vehicle after it has been damaged and then repaired.  Depending on the value and type of repairs, this depreciation can fluctuate.  For an in-depth explanation Click here.

Am I eligible to claim accelerated depreciation?

The laws and processes in which accelerated depreciation is determined varies depending on the location of the accident.  The following information pertains to British Columbia only.

The 2 components of an eligible accelerated depreciation claim are:
·          You are not at fault for the accident
·          There was another driver involved who is at fault.  There must be another person to name in the case of a lawsuit.  We have not seen success in accidents involving animals, hit and runs or vandalism.

Where do I start?

This depends on your situation, listed below are a few scenarios and the associated paths.

Scenario 1 - Your vehicle was involved in an accident where the following apply:
o    you were not at fault,
o    you were not injured
o    your insurance company is WILLING to pay accelerated depreciation

In these situations, you will need to hire an expert to assess the losses and provide a report which is given to your adjuster (our services). Ideally, your adjuster will accept the losses and compensate you for both the losses and the cost of the report.  We have seen this happen before, as recently as last week (June 2015).

Scenario 2 - Your vehicle was involved in an accident where the following apply:
o    you were not at fault,
o    you were not injured
o    your insurance company is UNWILLING to pay accelerated depreciation

There is where you would need to follow these steps - Do it yourself - Suing for accelerated depreciation

Scenario 3 - Your vehicle was involved in an accident where the following apply:
o    you were not at fault,
o    you were injured
o    you have chosen to hire a lawyer

Your personal injury lawyer would represent your accelerated depreciation claim at the same time as your personal injury claim.  Make sure your lawyer understands that accelerated depreciation is an important part of your claim, as some will not represent property losses

Scenario 4 – Your vehicle was involved in an accident where the following apply:
o    you were not at fault
o    you were injured
o    you have chosen not to hire a lawyer

In this situation, your adjuster may choose to accept an accelerated depreciation claim to minimize the potential risk of a personal injury lawsuit. Please refer to Scenario 2.


Online articles related to Accelerated Depreciation in Canada

Precedent Cases

The Fournier Auto Group Ltd. Provides Accelerated Depreciation reports:
Services - 

Sample Report - Sample Accelerated Depreciation Report
For a free consultation call 778-908-2804 or Click here to submit a “Request for a free consultation with an IVE"

Saturday, June 20, 2015

Success Story - June 2015

Today I spoke with a client whom I had provided an accelerated depreciation report for his Toyota Tundra. He provided the report to his insurance adjustor and they not only accepted it without litigation, they paid the full assessed loss and the cost of the report.

Friday, May 22, 2015

How to mitigate accelerated depreciation

Education is the easiest way to mitigate accelerated depreciation.  Buying or selling a vehicle can be intimidating for most.  Add an accident to the mix and it just complicates it even more.  There are few tools that I can see would help minimize accelerated depreciation.

1 - A clearly articulated report on the damages with images that communicates to people outside of the auto industry.  Understanding the damages makes a huge difference. This will also help when selling a vehicle.  It has been my experience that there is very little trust in the world of slinging new and used vehicle.  Documents from ICBC speak for themselves.

2 - A better-defined declaration process.  The majority of people I meet understand that in BC the declaration is $2000 per incident.  But the reality is that if your vehicle has an accumulation of damages over $2000, you must declare your vehicle as having a $2000 declaration.  Check out the transfer form, it even says "cumulative".

Having some perspective regarding damages will help minimize the need to sell a vehicle at a lower price.  When it comes to selling a vehicle if you are uncertain due to a lack of knowledge, it will impact what you are able to get for your vehicle.

If you have questions, we'd love to help
Services Click Here


Wednesday, December 17, 2014

I was recently involved in a car accident and consequently my VW Passat was written off. I now get the joy of shopping for a new vehicle for myself at Christmas. First world problem. Like a lot of people, I do not have access to unlimited funds and I also am not unrealistic about what I get for the money I have. For $7000.00, you will not be buying a brand new car (unless Lada is still kicking about). I have a few quick tips for people selling used cars for under $10,000. I know there could be an equal rant for people buying cars, but this particular rant is for the sellers!:

1 - Don't say your car is fantastic shape, when it has dents, scratches, stains and foul odors! I'm not blind and I will figure it out. Please save me the hassle of driving an hour to spend 5 minutes looking at your POS. The more honest you are the more likely I will appreciate it. If you've driven your car into the ground, the lesson is simple. Take care of your car, it will make it easier to sell in the long run.

2 - If you are trying to sell a vehicle, try to make it easy for a buyer to see the car. Don't arrange a meeting and forget to show up. It is a pain in the ass! We are both doing each other a favor. You probably need the money and I need the car. Let's work together. 50 / 50 rule. I'll drive half way, you drive half way.

3 - Know the history of your vehicle. I recently met a person who was selling an "excellent" condition vehicle. I spent less than 5 minutes before walking away. This vehicle had rust bubbles, lots of rust under the hood, poorly painted bumpers and a headlight that was loose. Perhaps I'm confused as to what "excellent" means?? When I pointed out the obvious flaws, the seller seemed surprised? Honest mistake or sketchy car sales shenanigans? You be the judge.

4 - Service history is super valuable. This shows you have actually taken care of your vehicle. Perhaps there could be some confusion as to what "taken care of" means. In my opinion it means that you not only put oil and gas in the vehicle, it also means addressing noises and sounds before they cause a cataclysmic malfunction. If you hear a humming, it may be a wheel bearing. Replace it before you have to replace a spindle. If you haven't heard of the broken window effect here is some good reading -

5 - Don't hide things. At some point during the transition from childhood to adulthood it became acceptable to lie to people? I know that some people don't understand vehicles and I can appreciate that. But when you go up and above to hide something from a potential buyer, you really have to wonder what kind of example are you setting.

People always say dealerships are slimy and deceitful, which in some cases is true, but keep in mind. They aren't the ones driving those used cars for 10 years and then trading them in. It starts with us.

<end rant>

Saturday, October 25, 2014

On October 1, 2014 the Winter Tire law went into effect in BC. Do you know which highways are affected?

Source -

When are Winter Tires or Chains Right for Me?
Winter tires and chains can make your vehicle safer.
You must use winter tires (passenger vehicles) or carry chains (commercial trucks) between October 1 and March 31 on most BC highways.
British Columbia's climates range from freezing cold to pleasantly mild in the winter; equipping your vehicle appropriately depends on what you are driving and where you are driving.

What is a Winter Tire?

British Columbia accepts “mountain snowflake” or “mud and snow” tires with at least 3.5 mm tread as winter tires.
Check your tires for these signs:
mountain snowflake 
The mountain/snowflake symbol on the side of the tire

These winter tires offer the best traction on snow and ice, and in cold weather.
mud and snow The mud and snow symbol on the side of the tire
These winter tires offer better traction than summer tires, however, they are less effective than mountain/snowflake tires on snow and ice, and in cold weather.
3.5 mm tread
Tires must have 3.5 mm of tread remaining to be considered winter tires.
Matching Winter Tires
You must have at least 2 matching winter tires on the same axle, but we recommend using 4
Studded Tires
May be used on BC highways from October 1 to April 30, but must have mountain/snowflake or M+S symbols to be considered winter tires.
Drivers in some parts of the southern coast, where regulations are more relaxed due to warmer weather, should use discretion when equipping their vehicles.

Designated Winter Tire and Chain-up Routes

Drivers must obey Winter Tire and Chain signs throughout the province. The designated routes require passenger vehicles to be equipped with M+S or mountain/snowflake tires, and commercial vehicles to carry chains from October 1 to March 31.
Click on the links below to see the regional highways requiring winter tires and chains.
As a guide, please follow the options below:

Car and Small Truck Drivers*

* Passenger vehicles and small commercial trucks less than 5,500 kg GVW

Commercial Truck Drivers*

* Trucks 5,500 kg GVW or greater

Thursday, July 31, 2014

For the first time since 1998 the average number of problems in vehicles has increased.

General Motors Company Receives Eight Segment Awards, While Toyota Motor Corporation Garners Seven and Honda Motor Company Earns Six
WESTLAKE VILLAGE, Calif.:  Owners of 3-year-old vehicles (2011 model year) report more problems than did owners of 3-year-old vehicles last year, according to the J.D. Power 2014 U.S. Vehicle Dependability StudySM (VDS) released today.

The study, now in its 25th year, examines problems experienced during the past 12 months by original owners of 2011 model-year vehicles. Overall dependability is determined by the number of problems experienced per 100 vehicles (PP100), with a lower score reflecting higher quality.

The study finds that overall vehicle dependability averages 133 PP100, a 6 percent increase in problems from 126 PP100 in 2013. This marks the first time since the 1998 study that the average number of problems has increased.

"Until this year, we have seen a continual improvement in vehicle dependability," said David Sargent, vice president of global automotive at J.D. Power. "However, some of the changes that automakers implemented for the 2011 model year have led to a noticeable increase in problems reported."

Increases in Engine and Transmission Problems Reported
Engine and transmission problems increase by nearly 6 PP100 year over year, accounting for the majority of the overall 7 PP100 increase in reported problems. The decline in quality is particularly acute for vehicles with 4-cylinder engines, where problem levels increase by nearly 10 PP100. These smaller engines, as well as large diesel engines, tend to be more problematic than 5- and 6-cylinder engines, for which owners report fewer problems, on average.

"Automakers are continually looking for ways to improve fuel economy, which is the primary purchase motivator for many consumers, particularly those buying smaller vehicles," said Sargent. "However, while striving to reduce fuel consumption, automakers must be careful not to compromise quality. Increases in such problems as engine hesitation, rough transmission shifts and lack of power indicate that this is a continuing challenge."

Dependability Leads to Loyalty; Poor Dependability Creates Avoidance
J.D. Power also finds that the fewer problems owners experience with their vehicle, the greater their loyalty to the brand. Combined data from previous years' VDS results and vehicle trade-in data from the Power Information Network├ć (PIN) from J.D. Power show that 56 percent of owners who reported no problems stayed with the same brand when they purchased their next new vehicle. Brand loyalty slipped to just 42 percent among owners who reported three or more problems.

Also, a comparison of data from the 2013 Vehicle Dependability Study with data from the subsequent J.D. Power 2014 U.S. Avoider StudySM shows that consumers are much more likely to avoid vehicles from brands that rank lower in dependability. On average, 23 percent of consumers avoided brands that ranked in the lowest quartile of the 2013 VDS because of concerns about reliability. In contrast, only 9 percent of consumers cited that same reason for avoiding brands that ranked in the top quartile.

"By combining our customer research with trade-in data, we see a very strong correlation between dependability and real-world brand loyalty," said Sargent. "Also, we see that brands with lower dependability are likely to be shut out of a significant piece of the market as many consumers will not even consider purchasing one of their vehicles because of concerns about its likely reliability."

Highest-Ranked Nameplates and Models
Lexus ranks highest in vehicle dependability among all nameplates for a third consecutive year. The gap between Lexus and all other brands is substantial, with Lexus averaging 68 PP100 compared with second-ranked Mercedes-Benz at 104 PP100. Following Mercedes-Benz in the rankings are Cadillac (107), Acura (109) and Buick (112), respectively.

General Motors Company receives eight segment awards on more than any other automaker in 2014 for the Buick Lucerne; Cadillac DTS (tie); Cadillac Escalade; Chevrolet Camaro; Chevrolet Volt; GMC Sierra HD; GMC Sierra LD; and GMC Yukon. Toyota Motor Corporation garners seven awards for the Lexus ES; Lexus GS; Lexus LS (tie); Lexus RX; Scion xB; Toyota Camry; and Toyota Sienna. Honda Motor Company receives six model-level awards for the Acura RDX; Honda CR-V; Honda Crosstour; Honda Element; Honda Fit; and Honda Ridgeline. MINI receives one model-level award for the MINI Cooper.

The Vehicle Dependability Study is used extensively by manufacturers and suppliers worldwide to help them design and build better vehicles, which typically translates into higher resale values and customer loyalty. It also helps consumers make more-informed choices for both new- and used-vehicle purchases.

The 2014 Vehicle Dependability Study is based on responses from more than 41,000 original owners of 2011 model-year vehicles after three years of ownership. The study was fielded between October and December 2013.

Find more detailed information on vehicle dependability, as well as model photos and specs, at

Media Relations Contacts
John Tews; Troy, Mich.; 248-680-6218;
Syvetril Perryman; Westlake Village, Calif.; 805-418-8103;

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