If you file a claim on your car for diminished value in California, you do not necessarily have to get your car repaired. You are still entitled to the money whether you repair your vehicle or not. Many people think that it is the other way around. Actually, some insurance companies will not pay for repairs to your vehicle and pay out the diminished value. The only exception is when you are still making monthly payments on the vehicle when the accident occurs. The bank or other lien holder may require that repairs are made in an effort to protect their investment.