Appraisal Process with Property Damage Disputes

Attorney Doug Goyen If you have a major dispute with your own insurance company regarding the amount it will cost to repair your vehicle or the total loss value of your vehicle, most auto insurance companies have an “appraisal” clause in their insurance policy designed to resolve these types of disputes.  The appraisal process with property damage disputes is supposed to help resolve any dispute you have with your own insurance company regarding the amount paid for damage to your property under first-party coverage.

If you have a major dispute with your own insurer under your collision coverage or comprehensive coverage – regarding the value of your vehicle or how much it will cost to repair it, you can use the appraisal clause to try and resolve the dispute.

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Auto insurers typically have a clause in their policy called “Appraisal” which outlines the contractual appraisal process with property damage disputes.

When there is a dispute regarding the value of the damage to your vehicle, the insurance company has not violated the terms of the insurance policy until you have invoked the appraisal process and completed the appraisal process. This is part of the reason the “appraisal” process is thrown into the insurance policy. The insurance company can make a low offer, and they are not violating any terms of the policy yet. You have to resolve the dispute via the “appraisal” clause in the insurance policy first. Typically, the insurance company will pay the amount the umpire decides fairly quickly after the umpire makes their finding.

Typical language of the policy will have language somewhat like the following:

“Demand for appraisal: If we cannot agree with you on the amount of a covered comprehensive loss or collision loss . . . either party may demand an appraisal to resolve the dispute.

Each chooses your own appraiser: If an appraisal demand is made, each party shall appoint a competent and impartial appraiser. Each party is responsible for paying the costs and expenses for the appraiser they appoint. The appointed appraisers will determine the amount of such comprehensive loss or collision loss.

If appraisers cannot agree, choose an independent umpire to resolve any dispute: If they cannot agree, the appointed appraisers will jointly select an impartial umpire, who shall determine the amount of the comprehensive loss or collision loss. The costs associated with the impartial umpire shall be divided evenly between you and us. The decision of the appointed appraisers or umpire is binding upon you and us.”

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Unfortunately, the appraisal process is not as easy as it sounds. Usually, a lawsuit needs to be filed to enforce the appraisal clause. The lawsuit is usually needed to get an “impartial” umpire appointed to make the final call. The typical scenario unfolds like this:

You can find independent appraisers on your own by looking at a search result on Google, Yellow pages, or other online search results. You may want to ask friends or family if they know anyone. Many Dallas, Tx car accident attorneys know someone who does work as an independent appraiser – and they may give you a name to use.

You choose your own independent appraiser, the insurance company will choose theirs (one of their employees). If there is already a major dispute regarding what is owed the two appraisers will rarely agree. The next step is to get an independent “impartial” umpire (as the policy language dictates) that you “both will agree on” to resolve the dispute.

The insurance policy says you both have to agree on an “impartial umpire”. You will need to get a list of impartial umpires. I would suggest that you get a list of 5-10 independent appraisers to act as an umpire (your independent appraiser usually can help you find other independent appraisers who may be able to act as an umpire).

Your insurance company will get a list of their own appraisers – they will be appraisers who are “independent in name only”. I say this because the appraisers the insurance company will have on their list will be appraisers that are not directly employed by the insurance company, but they will be appraisers who do contract work for the insurance company – so they are not really independent or “impartial”. You will not want an umpire who makes their living doing appraisals for the insurance company – not very impartial.

You will likely not agree to use any of their umpires because their appraisers will be the ones who get contract work/business from the insurance company. The insurance company will not agree to your independent and impartial appraisers because they want to control what they pay – they cannot control a true “independent” appraiser. This is typically the point where a lawsuit is needed.

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At this point, you have to file a lawsuit to enforce the insurance policy so a judge can appoint an impartial appraiser to act as umpire. You will need to produce your list of impartial appraisers to the judge showing your choice of appraisers to act as umpire.

The insurance company will introduce their list as well. The judge will make a decision based on the list of appraisers from you and from the insurance company. Research needs to be done on the list of appraisers the insurance company will give to the judge, to verify they are not impartial. Evidence needs to be produced to the judge showing the appraisers selected by the insurance company are biased.

The judge then makes a decision and chooses an appraiser from the two lists given them by you and the insurance company. The umpire chosen by the judge makes or breaks the case. If the judge picks from the insurance company’s list, you will likely be stuck with what the insurance company offered. If the judge picks one of the appraisers from your list, then you have a much better chance of getting a fair decision.

After the umpire is appointed by the judge, your appraiser, the insurance company’s appraiser, and the umpire all meet to do their appraisals on the property/vehicle. The umpire then makes their decision and their decision is binding.

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Determining whether it is worth pursuing the appraisal process depends on the cost of pursuing it v. the amount in dispute.

The costs of the appraisal process are:

1) The cost of hiring your own independent appraiser. The appraiser will likely do their initial appraisal and report somewhere in the hundreds of dollars – the exact amount depends on the appraiser. They will charge again when they need to go testify in court (if needed), and will charge again when they need to meet with the umpire at the end of the case.

2) The cost of hiring an attorney to file a lawsuit regarding the “impartial” umpire. The attorney can take your case on an hourly basis – the cost can range anywhere from $150-$400 per hour, depending on the firm. If a lawsuit is needed to get an order – you likely are looking at close to 10-20 hours at minimum. You might be able to get an attorney to take the case on a contingency fee – but the attorney is then taking a percentage of what you need to fix or replace your vehicle.

3) The filing fee and service of process with the court for the lawsuit to have the court choose an impartial umpire. The filing fee is $300-$400 depending on the county. The service of process will likely be between $100-$250 – depending on the person doing the service and how many attempts they must make to serve the insurance company.

4) Any investigation costs involved in looking up the background of the list of appraisers the insurance company chooses for their umpires. The costs of doing a background check of the insurance company’s appraisers may cost some money as well – depending on the services used.

5) Half the cost of the umpire chosen by the court. The umpire will likely charge a similar fee to what your appraiser charges, plus whatever time is needed to draw up their final report on their findings.

Due to the costs involved in pursuing the appraisal clause in an insurance policy, the dispute typically needs to be a fairly substantial dispute to be worth it. If you are haggling over a few hundred dollars here and there, it is likely not worth it. If the dispute is for a substantial amount, then you can consider using the appraisal process with property damage disputes.

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Attorney Doug Goyen is a Dallas personal injury attorney who has been licensed in Texas since 1997 and has decades of experience representing individuals in personal injury-related cases throughout Texas. Thousands of cases have been successfully negotiated, litigated, tried, and settled by Attorney Goyen. He has gotten his clients millions of dollars in compensation.

Our clients are well-represented by the Law Office of Doug Goyen. Our knowledge, experience, and desire for justice for our clients enable us to achieve proven results in their cases. Please contact us at (972) 599 4100. We will begin working on your case right away.


15851 Dallas Pkwy #605
Addison, Texas 75001
(972) 599 4100 phone
(972) 398 2629 fax

Directions to our office: We are on the southbound side of the service road to the Tollway. Stay on the Dallas North Tollway until you come to the Keller Springs exit. Take the Keller Spring exit. Stay on the service road on the southbound side and go just past Keller Springs. Our office is the 2nd building south of Keller Springs, located on the service road to the North Dallas Tollway in the Madison Business Center on the 6th floor.

By Doug Goyen,

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