Tuesday, March 4, 2014

What is accelerated depreciation and why should you care?

Accelerated depreciation is what happens to the value of a vehicle after it has been involved in a car accident and then repaired.

Here is an example:

A client has a 2012 Dodge Grand Caravan that was worth about $20,000 on the date of the accident.  The client was sitting at a stop light and was rear-ended by someone who was not paying attention.

The client and the offending driver go through the proper channels and report the accident to insurance.

Insurance in turn fixes the 2012 Dodge Grand Caravan because its cheaper to fix the car as opposed to replacing it.  In this case the repairs cost $9,000.  The vehicle is fixed and returned to the client.

This 2012 Dodge Grand Caravan is no longer worth the $20,000 because when going to sell the van the owner must disclose the $9,000 accident history.  This is accelerated depreciation.

In the province of British Columbia it is possible to recoup these losses.

The Fournier Auto Group provides the necessary assessments lawyers and clients need to recoup these losses.

If you have been in an accident and are concerned about your vehicles value, please call for a free consult.