Vehicle diminished value (araç değer kaybı) is the situation in which the second-hand market value of a vehicle remains below its pre-accident value even though the post-accident repair has been carried out properly. Under Turkish law this difference is recognised as a separate head of loss, and it may be claimed from the insurance company of the at-fault driver or directly through the insurance arbitration route. In practice many vehicle owners do not know that a further claim can be raised once the repair cost has been covered, and for that reason never claim the diminished value amount at all.
Key Takeaways
- Diminished value is a separate head of loss, independent of the repair cost; even where the repair invoice has been paid, a diminished value claim may still be raised separately.
- In the decision of the 17th Civil Chamber of the Yargıtay (the Court of Cassation) dated 03.06.2013, no. 2013/5126 E., 2013/8212 K., it was underlined that where the vehicle is treated as a total loss (pert total – written off for scrap), diminished value cannot additionally be claimed.
- The claim is first addressed to the insurance company in writing; if no favourable answer is received within 15 days, an application may be made to the Sigorta Tahkim Komisyonu (the Insurance Arbitration Commission).
- Diminished value cases may be characterised as consumer transactions within the scope of Law no. 6502 on Consumer Protection (6502 sayılı Tüketicinin Korunması Hakkında Kanun).
- The amount of diminished value is determined through an examination by a court-appointed expert (bilirkişi) according to the age, mileage, damaged area and model of the vehicle.
How Is Vehicle Diminished Value Compensation Calculated?
Diminished value is established by the court-appointed expert examining the difference between the market value of the vehicle before the accident and its second-hand market value after repair. Criteria such as the make, model, year of manufacture and mileage of the vehicle, the area of the damage and the number of repainted parts are taken into account in the calculation.
Which Criteria Increase Diminished Value?
Damage affecting load-bearing parts such as the chassis or the body shell, the vehicle being a recent model with low mileage, and damage concentrated on visible panels are the principal factors that increase the amount of diminished value. Minor damage to cosmetic parts such as the bumper generally leads to a lower diminished value.
The Position Differs for Written-Off Vehicles
According to the decision of the 17th Civil Chamber of the Yargıtay dated 03.06.2013, no. 2013/5126 E., 2013/8212 K., where the vehicle is accepted as a total loss (pert total) and its value is paid, diminished value cannot additionally be claimed, since the vehicle has already been compensated at its full value.
| Stage | Period | Addressee |
|---|---|---|
| Written application to the insurance company | – | The other party’s compulsory traffic insurance company |
| Period to await the company’s answer | 15 days | Insurance company |
| Application to the Insurance Arbitration Commission | At any time after the 15 days | Sigorta Tahkim Komisyonu |
| General statute of limitations | 2 years (from learning of the tort) / 10 years (maximum) | Civil Court of Commerce / Consumer Court |
Sample Calculation Scenario (Illustrative)
The example below is entirely hypothetical and illustrative in nature; it does not reflect an actual case file. Assume that a 3-year-old vehicle with 45,000 km and no record of damage suffered damage to its rear right wing and door in an accident and was repaired at an authorised service centre using original parts.
The Expert’s Assessment Steps
The court-appointed expert first determines the second-hand market value of the vehicle before the damage (for example from comparable listings), and then researches the current market value at which the same vehicle could be sold after repair with the note “accident recorded”. The difference between the two values constitutes the amount of the diminished value. The fact that the damage affected cosmetic parts rather than load-bearing chassis parts is a factor that keeps the diminished value ratio relatively limited in this example.
Comparative Scenario: If There Had Been Chassis Damage
Had the damage to the same vehicle affected the chassis or the safety equipment, the loss of confidence in the second-hand market would be more pronounced, and the diminished value ratio determined in the expert report would generally be higher. This comparison shows the extent to which the area affected by the damage influences the amount of the diminished value.
| Calculation Method | How It Works | When It Is Used |
|---|---|---|
| Market comparison method | Comparison of comparable second-hand listings before and after a damage record | For common models, where comparables are easy to find |
| Percentage-based diminished value method | Calculation at a fixed rate, as a specified percentage of the value of the vehicle | Where comparable data is limited and a quick preliminary assessment is needed |
| Technical examination by a court-appointed expert | Detailed examination of the damaged area, parts replaced and the quality of the repair | The method relied on in court proceedings and insurance arbitration |
How Is an Application Made to the Insurance Company for Diminished Value?
The application is made in writing to the compulsory traffic insurance company (trafik sigortası) of the other party, enclosing the claim file number, the accident report (kaza tespit tutanağı), the repair invoice and, if available, an independent loss adjuster’s report. The company is given a period of 15 days to assess the application and respond.
What Should the Application File Contain?
A copy of the vehicle registration certificate (ruhsat), the accident report, repair invoices, photographs taken before and after the damage, and, if available, comparative market data obtained from second-hand sale listings are important in strengthening the application.
What Can Be Done If the Insurance Company Refuses Payment or Pays Too Little?
Where the insurance company rejects the application or offers a low amount, the applicant may, before bringing court proceedings, apply to the Insurance Arbitration Commission, which is a swift and relatively low-cost solution, or may go directly to court.
Insurance Arbitration or Court Proceedings?
As at 2026, the application fees of the Insurance Arbitration Commission start at 600 TL depending on the amount in dispute and are applied as 1.8% of the amount for claims above 85,000 TL (sigortatahkim.org.tr, fee schedule dated 01.01.2026). Arbitration proceedings are generally concluded in a shorter time than court proceedings.
What Is the Statute of Limitations in a Diminished Value Case?
For compensation claims arising from tort, the statute of limitations (zamanaşımı) is 2 years from the date on which the loss and the tortfeasor are learned of, and in any event 10 years from the date of the incident (Turkish Code of Obligations no. 6098, TBK m. 72). Where the criminal laws provide for a longer limitation period, that period may be applied.
What Should Be Done So as Not to Miss the Deadline?
In order for the diminished value claim not to become time-barred, the application to the insurance company and, if necessary, the arbitration or court application must be made within time. For an up-to-date calculation of the periods you can use the statute of limitations and filing deadline calculator. For the statutory interest rates that will run if the insurance company pays late, you may review the difference between statutory interest, default interest and advance interest.
Is Diminished Value Compensation Assessed Within the Scope of Consumer Law?
In some decisions of the Yargıtay, diminished value cases brought by the insured in the capacity of a consumer against the insurance company have been characterised as consumer transactions within the scope of Law no. 6502 on Consumer Protection, and the consumer courts have been held to have jurisdiction. The competent court may vary according to the parties to the particular case.
Does the Degree of Fault Affect the Amount of Diminished Value?
Yes; like other heads of pecuniary loss, diminished value compensation is apportioned according to the degree of fault. If the other party is not 100% at fault for the accident, the claimant’s own share of fault is deducted from the calculated diminished value amount in order to determine the sum payable.
How Does an Objection to the Determination of Fault Affect the Diminished Value Claim?
An objection to the degree of fault, and any change in that ratio, also directly affects the amount of the diminished value compensation. For this reason the determination of fault and the diminished value claim should generally be assessed together; for detailed information on the subject you may review our article on objecting to the determination of fault.
Why Is an Independent Loss Adjuster’s Report Important?
The report prepared by the insurance company’s own loss adjuster (eksper) may generally provide for a lower diminished value amount in the company’s favour. A second report obtained from an independent loss adjuster serves as counter-evidence that strengthens the applicant’s position both in the insurance arbitration application and in court proceedings.
What Should Be Looked For in the Loss Adjuster’s Report?
The persuasiveness of the report is increased where it sets out, comparatively and with concrete data, the damaged area, the number of repainted and replaced parts, the mileage of the vehicle and the current market prices of similar second-hand vehicles.
Does the Quality of the Repair Affect the Amount of Diminished Value?
Yes; a post-accident repair carried out using imitation parts instead of original parts, or not carried out in accordance with proper procedure, may reduce the market value of the vehicle still further, and this may be separately taken into account in the expert report. Repairs carried out at an authorised service centre with original parts produce a more predictable picture in the diminished value calculation.
Keeping the Repair Invoices
Keeping the invoices showing the parts used during the repair and the details of the labour is important for proving the quality of the repair of the vehicle, both in the insurance application and in any court proceedings.
What Will the Other Side Do?
The insurance company, as the other side in a diminished value claim, also has its own defence strategy; being prepared for these defences determines the evidence with which the application or the case file needs to be strengthened.
- “The vehicle was treated as a total loss, so diminished value cannot additionally be claimed.” This assertion is met with the loss adjuster’s report and the repair documents showing whether the vehicle was in fact accepted as a total loss.
- “According to the company’s loss adjuster, the diminished value amount is very low or nil.” This defence is met with a second report obtained from an independent loss adjuster and with comparable second-hand market data.
- “The damage is to cosmetic parts, so no diminished value arises.” This assertion is met with photographs of the damage and with the expert report examining the damaged area from a technical standpoint.
- “The other party is not at fault, so the payment should be reduced accordingly.” This objection is met with the outcome of the separate objection procedure concerning the determination of fault and with the accident report.
Which defence comes to the fore varies according to the damage to the vehicle and the technical evidence in the file; for this reason it is important that the independent loss adjuster’s report be prepared before the application. To assess in advance which defence your file is likely to meet, you may get in touch.
Frequently Asked Questions
Is court action necessary for a diminished value claim?
No; making a written application to the insurance company first and then applying to the Insurance Arbitration Commission generally offers a faster solution; court proceedings may also be brought as a last resort.
Can diminished value be claimed for a vehicle repaired under comprehensive own-damage insurance?
Yes; the fact that the repair was covered by comprehensive own-damage insurance (kasko) does not remove the right to claim diminished value from the other party’s compulsory traffic insurance.
For which vehicles can diminished value not be claimed?
For vehicles treated as a total loss (pert total, written off for scrap), diminished value cannot additionally be claimed, since the value of the vehicle has been paid in full.
Who determines the amount of diminished value?
In insurance arbitration proceedings the expert, and in court proceedings the expert appointed by the court, examines the characteristics of the vehicle and reports the amount of the diminished value.
Which documents are required for a diminished value application?
The vehicle registration certificate, the accident report, repair invoices, photographs of the damage and, if available, an independent loss adjuster’s report are requested.
What is the deadline for bringing a diminished value case?
As a general rule it is 2 years from learning of the loss and the tortfeasor, and in any event 10 years from the date of the incident.
If a diminished value claim is rejected, can a further application be made?
Yes; a second application supported by new evidence or by an independent loss adjuster’s report may be made; however, moving on to the Insurance Arbitration Commission without prolonging the process is generally more efficient.
Which method is relied on in calculating diminished value?
In court proceedings and insurance arbitration, the technical examination method, in which the expert examines the damaged area and the quality of the repair in detail, is generally relied on.
What Should Be Done in Conclusion?
Since vehicle diminished value is a separate head of loss, independent of the repair cost, this right should be pursued separately even where the post-accident repair invoice has been paid. The process proceeds first by written application to the insurance company and then, if necessary, through the Insurance Arbitration Commission or court proceedings. Supporting the file with concrete evidence at every stage of the process is the most important factor directly affecting the outcome, both in arbitration and in court. Your particular situation needs to be assessed on the basis of your own file.
You may look at our material on insurance law disputes, which frequently arise together with a diminished value claim, at our article explaining the arbitration process for the course to follow where the insurance company does not pay, and at the statutory interest calculator for calculating default interest. You may also obtain information about claims for compensation for loss of financial support, which additionally arise where the accident results in death.
Is Diminished Value Different for Rental and Fleet Vehicles?
For commercial fleet vehicles and short-term rental vehicles, the diminished value calculation is made according to the sale value expected over the economic life of the vehicle, and the ratios may generally be lower than for private vehicles. It is advisable for the fleet manager or the rental company to have this difference stated separately in the expert report.
The Position for Brand-New Vehicles
For newly purchased vehicles with low mileage, the diminished value ratio is generally higher than for older, high-mileage vehicles, since in the second-hand market the note “accident recorded” reduces the price of new vehicles proportionally more.
If a Diminished Value Claim Is Rejected, Can a Second Application Be Made?
The rejection of the first application by the insurance company does not mean that the matter is closed altogether. A second application supported by a new independent loss adjuster’s report or by additional evidence may be made; however, it is generally more productive for the applicant to move on to the Insurance Arbitration Commission without prolonging the process.
Can Additional Documents Be Submitted During Arbitration?
Yes; during the arbitration application, or upon a request for additional documents by the rapporteur, new evidence not submitted in the first application to the insurance company may also be added to the file.
Is a Diminished Value Payment Subject to Tax or Court Fees?
Since diminished value compensation paid by the insurance company is in the nature of making good a loss, it is not treated as income and is not subject to income tax. In the case of compensation obtained through court proceedings, an ad valorem court fee (nispi harç) is calculated separately over the value of the claim, at the stages of filing the case and of the judgment becoming final.
Meeting the Attorney’s Fee out of the Compensation
If the case is won, part of the attorney’s fee (vekalet ücreti) paid by the claimant may be recovered from the other party within the framework of the Minimum Attorney’s Fee Tariff; for current amounts you may review the attorney’s fee calculator and plan the cost items of your file in advance.
Table of Periods
| Period | How long | Starting point |
|---|---|---|
| Period to await the insurance company’s answer | 15 days | From the written application to the insurance company |
| Limitation period (short) | 2 years | From learning of the loss and the tortfeasor |
| Limitation period (maximum) | 10 years | From the date of the accident |
Sources
- Turkish Code of Obligations no. 6098, TBK m. 72 – mevzuat.gov.tr
- Sigorta Tahkim Komisyonu – Application Fees (2026)
- Law no. 6502 on Consumer Protection – mevzuat.gov.tr
Related Articles
- Objecting to the Determination of Fault in a Traffic Accident: Report, Expert, Court
- If the Insurance Company Refuses Payment: Arbitration or Court?
- Compensation for Loss of Financial Support: Who Can Claim It and How Is It Determined?
- Hidden Defects and Mileage Tampering Rights in Second-Hand Vehicles
This article is for general information purposes and does not take the place of legal advice. Your particular situation requires a separate assessment of your own file. This article was prepared on the basis of the legislation in force as at 17.09.2026.
Av. Mehmet İlker Dinç
Insurance Law, Compensation Law, Employment Law, Corporate Law, Corporate Advisory
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