The insurer's method
The 17c formula, and why it lowballs you
Almost every diminished value offer you will receive comes out of one formula. It caps your loss at 10% before it starts, then reduces it twice more. Here is exactly how it works and exactly how to answer it.
Last reviewed 2026-07-287 min read
What 17c is
"17c" is shorthand for the calculation most US auto insurers apply when they evaluate a diminished value claim. It takes three steps:
- Start with 10% of the vehicle's pre-accident value. This is the base loss value and it is a ceiling, the formula cannot produce a number above it, no matter what happened to the car.
- Multiply by a damage modifier between 0.00 and 1.00 based on severity.
- Multiply again by a mileage modifier between 0.00 and 1.00 based on the odometer.
The modifiers
| Damage severity | Modifier |
|---|---|
| Severe structural damage | 1.00 |
| Major damage to structure and panels | 0.75 |
| Moderate damage to structure and panels | 0.50 |
| Minor damage to structure and panels | 0.25 |
| No structural damage or replaced panels | 0.00 |
| Odometer | Modifier |
|---|---|
| 0 – 19,999 | 1.00 |
| 20,000 – 39,999 | 0.80 |
| 40,000 – 59,999 | 0.60 |
| 60,000 – 79,999 | 0.40 |
| 80,000 – 99,999 | 0.20 |
| 100,000+ | 0.00 |
The formula, worked through
Take a $30,000 car with 55,000 miles that needed $8,000 of repair including frame work.
Base loss value: $30,000 × 10% = $3,000
Damage modifier (major, structural): × 0.75 = $2,250
Mileage modifier (40,000–59,999): × 0.60 = $1,350
The offer is $1,350 on a car that took $8,000 of structural repair. A market-based valuation on the same facts typically lands somewhere between $3,500 and $4,500, the market discount on a $30,000 car with frame repair on its record is simply larger than the formula is capable of producing.
Now move the odometer to 101,000 miles
Same car, same $8,000 of frame damage, one more year of commuting. The mileage modifier becomes 0.00 and the formula returns $0.00. Not a small number, zero. The formula asserts that a vehicle past 100,000 miles suffers no resale loss at all from a reported structural accident. No published market data supports that, and it is the clearest evidence that this formula measures the insurer's exposure rather than your loss.
See what your car is actually worth less
Our calculator shows the market-based figure and the 17c figure side by side, so you can see the gap before you speak to anyone.
Run the free calculatorWhere it came from, and what that is worth
The formula is universally traced to litigation in Georgia in the late 1990s and early 2000s over whether insurers had to assess diminished value at all. In State Farm Mutual Automobile Insurance Co. v. Mabry, 274 Ga. 498 (2001), the Georgia Supreme Court held that they did, and affirmed an injunction requiring State Farm to evaluate every first-party claim for diminution in value.
The name "17c" is commonly said to come from paragraph 17(c) of the trial court's order in that case. Here is the part worth knowing: that attribution is not verifiable in the Supreme Court's opinion. The opinion expressly declined to impose any methodology. It required State Farm to develop one, because the undisputed evidence was that the company had no method in use at all. The 10%-cap-plus-multipliers structure circulates almost entirely through appraisal firms and claim-help sites rather than through any court order, statute or regulator.
Why this matters to your claim
The formula's authority is asserted, not documented. Two things are true and separable:
- The obligation to assess diminished value is real and, in Georgia, applies even to first-party claims.
- 17c as the measure of it was never mandated anywhere. No court imposed it, no statute enacts it, and no regulator requires it. It was adopted industry-wide because it is cheap to apply, needs no market research, and reliably produces small numbers.
So when an adjuster presents 17c as though it were the rule, the single most useful thing you can do is ask them, in writing, to identify the statute or regulation that requires it. There is not one.
Four things wrong with it
1. The 10% cap has no evidentiary basis
The formula cannot return more than 10% of a vehicle's value under any circumstances. Published analyses of accident-branded resale pricing routinely find discounts well above that on newer vehicles with structural repair. The cap is not a finding; it is an assumption built into the arithmetic before anything about your car is considered.
2. The mileage modifier is double-counting
This is the strongest technical objection and the one adjusters find hardest to answer. The formula begins from the vehicle's pre-accident market value, a figure that already reflects the odometer. A 60,000-mile car is already valued lower than a 20,000-mile one. Applying a second, separate mileage reduction to the loss charges you for the same mileage twice.
3. Multiplying fractions collapses the result
Both modifiers are between 0 and 1, and they compound. A perfectly ordinary claim, moderate damage, 70,000 miles, is reduced to 0.50 × 0.40 = 20% of a figure that was already capped at 10% of the car's value. The claim is worth, at most, 2% of the vehicle.
4. It ignores everything the market actually prices
The formula has no input for whether the repair used OEM or salvage parts, whether the finished work is visible, what segment the vehicle is in, whether it already had accident history, or what accident-branded examples of that exact model are currently listed at. Every one of those measurably affects resale price.
How to answer a 17c offer
Put it in writing. A phone conversation does not go in the file in the form you want it to.
- Ask for the authority."Please identify the statute or regulation that requires diminished value in [your state] to be calculated using this formula." There is none, and the request frequently moves the file to a supervisor.
- Name the double-count."The calculation begins from a market value that already accounts for the vehicle's mileage. Applying a further mileage multiplier to the loss reduces the claim twice for the same factor."
- Challenge the cap."The 10% base cap is applied before any consideration of this vehicle. Please provide the market data supporting 10% as the maximum resale impact of a reported structural accident on this make and model."
- Put your own evidence in. Comparable listings for the same year, make and model, some clean and some accident-branded, adjusted for mileage. This is the part an adjuster cannot argue with in the abstract.
- State a figure and a date. One number, one deadline, and a willingness to consider contrary evidence if they provide it.
What to use instead
A market-based method: establish the pre-accident value, then estimate what the market now discounts an accident-branded example of that vehicle by, using the factors that actually move resale price, repair cost relative to value, structural damage, age, mileage against expectation, segment, prior history, and repair quality.
That is what our calculator does, and the methodology is published in full, including every coefficient and the caps. The valuation report prints the arithmetic alongside a section that takes the insurer's 17c number apart on these grounds, which is the section that tends to change the conversation.
FAQ
17c formula questions
What is the 17c formula?
The 17c formula is the method most auto insurers use to calculate diminished value. It caps the loss at 10% of the vehicle’s pre-accident value, then multiplies that figure down by a damage severity modifier (0 to 1.0) and a mileage modifier (1.0 for under 20,000 miles, falling to 0 at 100,000 miles). Because both modifiers are fractions, the result is almost always a small fraction of the actual market loss.
Is the 17c formula required by law?
No. The 17c formula has never been adopted as a statutory or regulatory limit on diminished value recovery in any US state. It emerged as one acceptable methodology discussed in a Georgia class settlement and was subsequently adopted industry-wide by choice. You are not obliged to accept it, and saying so in writing is often what moves a claim.
Why does 17c produce $0 for high-mileage cars?
The formula’s mileage modifier is 0.00 for any vehicle with 100,000 or more miles. Multiplying by zero produces zero regardless of how severe the damage was or how valuable the car is. This asserts that a high-mileage vehicle suffers no resale loss whatsoever from a reported accident, which no published market data supports and which is the formula’s single most attackable feature.
How do I challenge a 17c offer?
Respond in writing. Ask the insurer to identify the statute or regulation that requires the formula (there is none). Point out that mileage is already reflected in the pre-accident market value the formula starts from, so applying it again as a multiplier is double-counting. Then present a market-based valuation with comparable listings showing what accident-branded examples of your vehicle actually sell for.
What is the modified 17c formula?
Some insurers and appraisers use variants that adjust the base cap or the multiplier bands, for example raising the 10% cap, or using a gentler mileage curve. The variants are still built on the same two structural assumptions: a fixed percentage cap and a mileage discount applied on top of a value that already accounts for mileage. The same objections apply.
See the gap for your own car
The calculator shows both numbers side by side. Free, no account.