Appraisal Clause

What Is an Appraisal Clause in Auto Insurance?

Most Texas policyholders have never heard of the appraisal clause, even though it's likely sitting in their own policy right now.

The Short Answer

The appraisal clause is a contractual provision that lets either you or your insurer demand a binding, independent determination of a disputed claim amount — without filing a lawsuit. It's built into the policy itself under Texas Insurance Code Chapter 1813, and it applies to disagreements over dollar amount, not disputes over whether something is covered at all.

How It Works, Briefly

Each side names an appraiser. If the two appraisers agree, that number is final. If they disagree, a neutral umpire is brought in, and the agreement of any two of the three becomes binding.

Frequently Asked Questions

Is the appraisal clause the same as filing a lawsuit?
No. It's a separate, typically faster and less expensive process built into the insurance contract itself, and it doesn't require going to court.

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