Notice: The insurance adjuster will never tell you about this, you need to do your own research!
In a total loss situation, your car is so damaged that it would cost more to fix than it’s worth, or it’s just not safe to repair.
In this case, the insurance company usually wants to pay you for the value of your car before the accident, instead of fixing it, this value is called ACV or Actual Cash Value.
But oftentimes, you and the insurance company might disagree on what your car was worth right before the accident. Insurance carriers are after all a for-profit business.
Let’s say you believe your car was worth $15,000, but the insurance company says it was only worth $10,000. That’s where the appraisal clause steps in!
Here’s how the process works in a total loss situation:
- You pick an appraiser who specializes in valuing cars. This person looks at your car’s condition, age, mileage, and other factors to estimate its value. A company like ours! 😉
- The insurance company picks its own appraiser to do the same thing.
- The two appraisers attempt to resolve the values.
- If your appraiser and the insurance company’s appraiser disagree on the value, they bring in a third person, called an umpire, who acts like a judge. You pay half the umpire cost.
- The umpire considers both appraisers’ values and helps decide on a fair value for your car. If two out of the three (your appraiser, the insurance appraiser, or the umpire) agree, that amount is what the insurance will pay you.
So, the appraisal clause in a total loss situation is a fair way to decide on your car’s value, making sure you get a reasonable amount without having to argue back and forth endlessly with the insurance company.
95% of claims we handle don’t require an umpire and are settled at step 3.
Wondering how much your car is worth? Click here and get a free Total Loss Quote Today!
