Imagine you get into a car accident, and your insurance company says the claim amount is way below what it should be. You would be left without the means to replace your vehicle. Aren’t insurance companies supposed to do what is in your best interest? That is only sometimes the case.
That is why in auto insurance policies there is something called the appraisal clause. This clause allows you to enact a process of additional appraisals to determine the true value of the damages. Insurance appraisers are the ones you work with when enacting this clause.
The Insurance Appraisal Clause
When damages happen to your vehicle, your insurance provider will give you an estimated claim from an adjuster. The insurance claim may be different from what you expected it to be. This is fair in most cases, but if you feel it is grossly undervaluing the damages, you can use the appraisal clause.
When you enact the insurance appraisal clause, you must inform your insurance company in writing or official notice. Once the process begins, you and your insurance provider will select insurance appraisers.
Role of Auto Insurance Appraisers
The two appraisers need to be objective and assess the damages to determine the vehicle’s actual cash value. The appraisers act as a third party to help resolve disputes with your insurance company.
They will look into many factors to help determine the extent of damages and how much your insurance provider will need to cover.
The decision reached by the appraisers is binding on all parts. This means that it is the final value that will be used in your insurance claim.
How Auto Insurance Appraisers Work
You and your insurance company will select two appraisers as third-party reviewers. The appraisers are paid by the ones who hired them, you and your insurance provider, respectively.
Once hired, they start by assessing the actual cash value of your vehicle. This will differ from the market value of your car. They will then look into the cost of the damages that happened to your vehicle. They weigh the cost of damages versus the true value of your vehicle to decide the final insurance claim.
Umpire Insurance Appraiser
Sometimes, two appraisers cannot mutually agree on a final cost. When this happens, they will select another impartial appraiser called an umpire to help settle the dispute.
The umpire is paid half from you and half from your insurance provider. The umpire insurance appraiser does their own investigation and comes to their own conclusion about the situation. Their decision settles the disputes of insurance claims.
Factors That Determine Actual Cash Value
There are several factors that insurance appraisers look at to decide the true value of your vehicle. Some of these factors are similar to marketplace features. However, some things they look at make the insurance value of your vehicle different.
Some familiar elements that help calculate the value of your vehicle include mileage, mechanical issues, depreciation, wear and tear, cosmetic damage, and prices of similar vehicles in your area.
Insurance appraisers look at a few extra things: the pre-loss condition of your vehicle, if there were any modifications or add-ons, the salvage value of your vehicle, and even the popularity of the color, year, make, and model.
Why Hire An Insurance Appraiser?
The main reason you might want to hire an auto insurance appraiser is to settle a dispute you have with your insurance company. As stated above, when you feel that the value provided by your insurance provider is insufficient, you can enact the appraisal clause. If the appraisal goes in your favor, you can get the payout you deserve.
One thing to remember is that you will have to pay your selected appraiser and potentially half the payment to an umpire appraiser if necessary. You need to make sure that the true value of your loss is greater than what you are initially offered. If not, you may lose money by enacting the appraisal clause.
How To Choose The Right Insurance Appraiser
The best way to get the most out of the appraisal clause is to choose the right insurance appraiser. They will be your partner to help you navigate the policy and find the true value of your loss.
First, a great insurance appraiser must not have any connections to your insurance company. If the appraiser does work for your insurance provider, it can be a conflict of interest.
Secondly, they need to be fair and upfront with you about costs. There are times when an appeal is not even worth going after. The right insurance appraiser will consult you before you enact the appraisal clause. They will look into your situation and let you know if their services will be a good fit for you.
Lastly, your chosen appraiser must have experience and good reviews to show their expertise. Look to see if your appraiser has positive reviews and case studies. This is a good indicator that they are a trusted expert in appraisals.
In Conclusion
Insurance appraisers can help you when your insurance coverage seems grossly inaccurate. They can be a means of settling disputes with your insurance provider. That is why there is an appraisal clause to help you find the true value of your vehicle.
If you need to hire an insurance appraiser, find reputable companies like KEH Consultants. They give you a free consultation to see if their services suit your situation.
