The 17c Formula: Why Insurance Companies Use It to Shortchange Your Diminished Value

The 17c formula (named after a Georgia court case, *Mabry v. State Farm*, claim #17c) is a method insurance companies use to calculate diminished value. It was never intended to be a universal standard — it was one adjuster's worksheet from one case. But insurance companies adopted it because it consistently produces the lowest possible DV number.

Here's how it works:

Step 1: Take your vehicle's pre-accident value (say $30,000) Step 2: Cap it at 10% — that's $3,000 maximum Step 3: Apply a "damage severity" multiplier (0.00 to 1.00) based on how bad the damage was Step 4: Apply a "mileage" multiplier that reduces the value further for higher-mileage vehicles

The result? A formula engineered to minimize your payout at every step.

The 10% cap is arbitrary. There's no market data supporting a 10% maximum. Carfax transaction data shows accident-history vehicles lose 10-25% of value — and severe structural damage can cause 30-40% loss. The 17c formula ignores this reality.

The multipliers are subjective. Who decides if your damage is "moderate" (0.50 multiplier) vs "severe" (1.00)? The insurance adjuster — the person whose job is to pay you less.

Mileage penalties are excessive. The formula applies steep mileage deductions that don't reflect how the actual used car market prices vehicles.

Example: Your $30,000 truck has moderate structural damage. The 17c formula says: $30,000 x 10% = $3,000 x 0.50 severity = $1,500 x 0.75 mileage = $1,125. But comparable market data shows the real diminished value is $6,000-$9,000. The formula shortchanged you by 80%.

We calculate diminished value using actual market data — not a formula designed to save insurance companies money.

Black Book dealer transaction data: Real wholesale and retail prices from actual vehicle sales. The same data banks use to approve car loans.

Local comparable analysis: What did clean-title vs accident-history versions of your specific vehicle actually sell for in the Utah market?

USPAP methodology: Our appraisals follow the Uniform Standards of Professional Appraisal Practice — the gold standard recognized by courts and insurance companies.

As attorney Brad DeBry explains: "Many insurance companies and some states use a formula to decide what diminished value is on your car. Those are ballpark numbers. The real value is the before-and-after financial damage to your car."

The result is typically 3-5x higher than what the 17c formula produces. And it's backed by evidence insurance companies can't dismiss. Learn more about how we handle diminished value claims in Utah.