Disclaimer
This article is for educational purposes only and is not legal advice.
Detailed Answer
An appraisal clause lets you and your insurer resolve a dispute over the amount of loss—such as diminished value—without going to court. Diminished value is the difference between your vehicle’s market value before and after damage and repair. If your insurer’s offer undervalues that loss, you can invoke the appraisal clause in your South Carolina policy.
Step 1: Confirm Your Appraisal Clause. Review your auto or property policy for an appraisal provision. It typically appears under the “Conditions” or “Loss Settlement” sections. South Carolina law does not itself create an appraisal right but enforces the contract language under SC Code Ann. §38-59-10 et seq..
Step 2: Send a Written Demand. Prepare a formal letter to your insurer referencing the appraisal clause, your policy number, and the low diminished value offer you wish to contest. State that you invoke the appraisal provision and demand a separate appraisal to determine the actual loss. Deliver this demand by certified mail or another trackable method to ensure proof of receipt.
Step 3: Select Your Appraiser. Once the insurer receives your demand, you must appoint an independent, qualified appraiser within the time frame stated in your policy (commonly 20 days). Notify the insurer in writing of your appraiser’s name, contact information, and qualifications.
Step 4: Insurer’s Appraiser and Umpire. The insurer then appoints its own appraiser. If your appraiser and the insurer’s appraiser disagree on the amount of loss, they should select a neutral umpire. If they cannot agree on an umpire within the time frame required by your policy, either party can ask a court of competent jurisdiction to appoint one.
Step 5: Conduct the Appraisal. The two appraisers (and umpire, if needed) inspect the vehicle, review repair estimates and market data, and independently determine the diminished value. They must then submit a written award stating the loss amount agreed upon or the average of their two opinions if the umpire helped resolve a dispute.
Step 6: Binding Award and Payment. Most policies make the appraisal award binding on both you and the insurer for the loss amount. After you receive the award, submit it to the insurer. They must pay the amount within the time frame set by your policy or South Carolina regulations governing claim payment practices.
Helpful Hints
- Act Promptly: Check your policy for appraisal time limits and meet each deadline exactly.
- Choose a Qualified Appraiser: Select someone with vehicle valuation or repair expertise.
- Keep Records: Save copies of your demand letter, certified mail receipts, and all appraisal communications.
- Understand Scope: Appraisal covers only the loss amount, not liability or coverage issues.
- Consider Legal Advice: If the insurer refuses appraisal or disputes its validity, consult a South Carolina attorney experienced in insurance claims.