Reviewed by Larry Forman, Attorney
The first problem after almost every crash is the car. It needs to be towed, estimated, repaired or totaled, and you need something to drive in the meantime. Your car property damage claim moves on a different track from any injury claim, with different rules, different coverage and a different deadline. This guide explains how it works in Kentucky and where insurers commonly shortchange people.
Property damage claims usually move faster than injury claims, and you can settle the car without settling your injury claim. The key is to keep the two separate, which we explain below.
Two ways to bring a car property damage claim
You usually have two options, and sometimes you use both:
A third-party claim against the at-fault driver’s insurer. Every Kentucky auto policy must include at least $25,000 in property damage liability, “including the loss of use thereof,” or a $60,000 combined single limit (KRS 304.39-110). You pay no deductible, but the other insurer may dispute fault or drag its feet.
A first-party claim under your own collision coverage. This is often faster. Worried a claim will raise your rates? See whether insurance rates can go up after a not-at-fault accident. You pay your deductible, and your insurer can then pursue the other driver’s insurer (subrogation). If you ask, your insurer must include your deductible in its subrogation demand and share any recovery with you proportionately (806 KAR 12:095 § 7(5)).
PIP doesn’t pay for your car. Kentucky’s no-fault benefits cover medical expense, work loss and replacement services, not vehicle damage (KRS 304.39-020). See how Kentucky PIP works.
If the other driver had no insurance, Kentucky’s required uninsured motorist coverage is for bodily injury, not property damage (KRS 304.20-020). Your car is usually covered only through your own collision coverage. See our uninsured motorist and hit-and-run pages.
What Kentucky law says you’re owed
Against the at-fault driver, the measure of damages is the difference in your car’s fair market value immediately before and immediately after the crash. Kentucky’s highest court has applied that rule for decades (Ecklar-Moore Express, Inc. v. Hood, 1953), and the state’s insurance regulations repeat it (806 KAR 12:095 § 7(2)).
In practice:
A repair bill is usually the evidence. An unchallenged repair bill is enough to prove the loss (McCarty v. Hall, Ky. App. 1985).
But repair cost isn’t always the ceiling. When there’s competent evidence that the car lost more value than the repairs cost, recovery isn’t limited to the repair bill (Ecklar-Moore). That’s the legal basis for a diminished value claim.
Your share of fault reduces the payment. Under Kentucky’s comparative fault rule (KRS 411.182), a driver found 20% at fault recovers 80% of the loss.
Getting your car repaired
Kentucky’s unfair claims settlement regulation sets ground rules for insurers (806 KAR 12:095 § 8):
You get a copy of the estimate the insurer relies on.
The estimate must be reasonable and enough to do the repair “in a workmanlike manner.”
If your shop’s estimate is higher, the insurer must pay the difference or promptly name at least one shop that will do the job for its number. If it designates only one or two shops, it must make sure the repairs are done in a workmanlike manner.
Betterment deductions (charging you because new parts make the car “better”) are allowed only if they reflect a measurable increase in value and are itemized.
Aftermarket parts can’t be required unless they’re at least equal to the originals in fit, quality and performance.
No unreasonable travel to get an estimate or a repair.
Hidden damage often turns up once a shop takes the car apart. Ask the shop to send a supplement to the insurer before doing the extra work.
When your car is totaled
When repair costs approach the car’s value, the insurer will usually declare it a total loss and pay its actual cash value instead.
How your own insurer must value it. Under 806 KAR 12:095 § 7(1), when your policy pays actual cash value, the insurer must either:
Offer a specific, comparable replacement vehicle with taxes and transfer fees paid, or
Pay a cash settlement based on what it actually costs to buy a comparable car in your local market, including applicable taxes, license and title fees.
If the insurer uses a valuation database, the value must be adjusted for options and enhancements the database missed. If you present two independent appraisals showing a higher local market value, the insurer must consider them (unless your policy has an appraisal clause). If you tell the insurer within 35 days of receiving the check that you can’t buy a comparable car for that amount, it must reopen the claim and either find you one or pay the difference.
Disputing the number. Ask for the full valuation report. Check the trim level, mileage, options and condition rating, and whether the “comparables” are really comparable and really local. Dealer listings for the same model, trim and mileage are your strongest evidence.
Title and loan issues. Kentucky requires a salvage title when the cost to restore the car exceeds 75% of its retail value (KRS 186A.520). A rebuilt car is later titled as a “rebuilt vehicle” (KRS 186A.530), which is one reason a badly damaged car loses value. If you owe more than the car is worth, the payout goes to your lender first. Gap coverage, if you bought it, may cover the shortfall.
Diminished value: when a repaired car is worth less
A car with a crash on its history report often sells or trades for less than an identical car without one, even after a good repair. In Kentucky:
Against the at-fault driver’s insurer, diminished value can be part of your claim, because the law measures the before-and-after drop in market value, not just the repair bill (Ecklar-Moore).
You have to prove it. In Wittmer v. Jones (1993), the Kentucky Supreme Court rejected a demand that was based on unsupported “computations.” The insurer had to pay on proof of loss, but it didn’t have to investigate the claimant’s loss for her. Bring evidence: a written appraisal from a qualified appraiser or dealer, and history-report and market data for your car.
Against your own insurer, it usually isn’t covered. A first-party claim is governed by your policy and “shall not include any measure of damages not specifically provided for in the policy” (806 KAR 12:095 § 7(2)). Most collision coverage pays repair cost, not lost resale value.
Diminished value claims are strongest for newer, low-mileage or higher-value cars with structural or frame damage. They’re weakest for older, high-mileage cars with cosmetic damage.
Rental cars and loss of use
Kentucky law recognizes loss of use of a vehicle “regardless of the type of use” as part of a property damage liability claim. But it’s limited to “reasonable and necessary expenses for the time necessary to repair or replace” the car (KRS 304.39-115).
What that means:
Rent something comparable, not an upgrade, and keep the receipts.
The clock runs for the time it reasonably takes to repair or replace the car. Delay caused by your own inaction, or time spent negotiating with an insurer, may not count (Howard v. Adams, 1952). Get the car to a shop and keep things moving.
If your car is totaled, loss of use runs for a reasonable time to find a replacement, and it generally ends soon after the insurer pays.
Your own policy pays for a rental only if you bought rental reimbursement coverage, and usually only up to a daily and total limit.
Personal property and other costs
The property damage claim can also include towing and storage, and items damaged in the car, such as a phone, laptop, child car seat or tools. Photograph everything and keep receipts. Storage fees add up daily, so authorize the move to a shop or the insurer’s yard quickly.
Protect your injury claim while you settle the car
Read every release. Before you sign anything to get paid for your car, make sure it covers property damage only. A general release can end your injury claim.
Don’t give a recorded statement about your injuries to the other driver’s insurer just because you’re talking about the car. See insurance adjuster tactics.
The deadline
A lawsuit for damage to a car or other personal property must generally be filed within two years (KRS 413.125). Injury claims have different deadlines. See our Kentucky statute of limitations guide.
How Forman & Associates can help
Property damage is usually the first fight after a crash, and it often sets the tone for how an insurer will treat the injury claim. When we represent you on an injury claim, we help you keep the property claim moving and make sure nothing you sign affects your injury case. We also help gather the evidence that matters for both. If the case goes further, we’re ready: Larry Forman has tried 50+ jury trials and won 95% of them. See what drives the value of an injury case, our car crash page, or learn more about Larry Forman.
Car property damage FAQs
Can I claim diminished value in Kentucky?
Yes, against the at-fault driver’s insurer, if you can prove your repaired car is worth less than it was before. Kentucky measures property damage by the drop in market value, and repair cost doesn’t cap the claim when there’s competent evidence of a greater loss.
Will my own insurance pay diminished value?
Usually not. A first-party claim is limited to what your policy provides, and most collision coverage pays repair cost or actual cash value, not lost resale value.
How is a totaled car valued in Kentucky?
Under state regulations, your insurer must pay what it would cost to buy a comparable car in your local market, including taxes and fees, or provide a comparable replacement. You can challenge the value with two independent appraisals or comparable local listings.
Does the at-fault driver’s insurance have to pay for a rental?
It must pay reasonable and necessary loss-of-use expenses for the time needed to repair or replace your car. Keep it comparable, keep the receipts, and don’t let the repair stall.
Do I have to use the insurance company’s body shop?
No. If your shop’s estimate is higher, the insurer must pay the difference or name a shop that will do the work for its estimate, and it can’t make you travel an unreasonable distance.
How long do I have to file a property damage claim in Kentucky?
Generally two years to file a lawsuit for damage to your car. Don’t wait that long to start the claim, because evidence and rental costs only get harder to manage.
Questions about your car and your injuries?
If you were hurt in the crash, the car is only part of the picture. Get a free case evaluation or call (502) 931-6788. No fee unless we win. Our office is at 1139 S. 4th St., Louisville, KY 40203. More guides are in our Kentucky Injury Resource Center.
This page is general information about Kentucky law as of October 2026, not legal advice.
