Appraisal Clause Auto Insurance

An appraisal clause in auto insurance is a policy feature designed to resolve disputes between the policyholder and the insurance company regarding the value of a claim. This clause is especially useful in disagreements over repair costs or total loss settlements. When both parties cannot agree on the amount, either can invoke the appraisal clause. 

Each party selects a qualified appraiser, and those two appraisers then choose a neutral umpire. If the appraisers cannot reach an agreement, the umpire steps in to make the final decision. The decision agreed upon by any two of the three becomes binding. The appraisal clause auto insurance provides a fair, efficient, and legally binding alternative to lengthy court battles. Always check your policy for this important clause.