What Is a Car Insurance Appraisal?

In auto insurance, “appraisal” can mean two different things:

Claim appraisal (most common): A dispute-resolution process used after a covered loss—when you and the insurer agree the claim is covered but disagree on the dollar amount.
Pre-insurance vehicle appraisal (less common): A valuation report used to insure a classic, collector, or specialty vehicle under an agreed value or similar endorsement.

This article focuses on claim appraisals—the one that comes up when a settlement offer feels low.

Quick tip: If your adjuster says “that’s the estimate,” ask whether your policy includes an appraisal clause for disputes about the amount of loss. The clause is usually in the claims or conditions section.

When You Might Need an Appraisal

An appraisal is most useful when the disagreement is about numbers, not coverage. Common examples include:

Total-loss valuation disputes: You think the insurer’s ACV is too low based on your car’s condition, options, mileage, or local market comparables.
Repair estimate disagreements: A shop says repairs will cost more than the insurer’s estimate (often because of hidden damage, OEM procedures, calibrations, or parts pricing differences).
Diminished value arguments: In some situations (often third-party claims), you’re seeking compensation for reduced resale value after a quality repair.
Specialty vehicles: Modified, classic, rare-trim, or limited-production vehicles where “book value” may not reflect the real market.

Appraisal is usually not the right tool if the insurer is denying coverage, arguing your policy doesn’t apply, disputing exclusions, or fighting liability/fault. In those cases, you’re in a coverage or legal dispute—not a valuation dispute.

Appraisal vs Estimate vs Inspection

Term	What It Usually Means	What It’s Used For
Inspection	Someone (adjuster/appraiser/shop) documents visible damage and vehicle details.	Evidence gathering: photos, VIN, options, condition, damage mapping.
Estimate	A repair-cost worksheet based on known damage and assumptions (often revised later).	Initial settlement for repairable vehicles; may change with supplements/teardown.
Claim Appraisal	A formal process to set the amount of loss when you and the insurer can’t agree.	Resolving valuation disputes for repairs and/or total-loss ACV (policy/state dependent).

How the Appraisal Clause Works

Many auto policies include an appraisal clause that works like a simplified, industry-specific dispute process:

A Typical Appraisal Clause, Step by Step

Step	What Happens	What You Should Do
1) Written demand	You or the insurer triggers appraisal after you’ve hit an impasse on the amount of loss.	Ask for the carrier’s written valuation/estimate and compare it to your evidence.
2) Each side picks an appraiser	You select an independent appraiser; the insurer selects theirs.	Choose someone with experience in your dispute type (repair estimate vs total loss).
3) Appraisers evaluate	They review damage, scope, and/or market value, then exchange findings.	Provide maintenance records, recent upgrades, photos, and comparable listings (if relevant).
4) Umpire if needed	If the two appraisers can’t agree, they select a neutral umpire (or another process applies).	Understand costs: you typically pay your appraiser and share the umpire fee (policy/state dependent).
5) Binding number	In many clauses, agreement by any two (appraiser/umpire) sets the amount of loss.	Confirm what the award covers (repairs, ACV, taxes/fees where applicable, salvage retention).

What Happens If the Appraisers Disagree?

When appraisers disagree, the dispute typically goes to an umpire (a neutral third party). In many policy wordings, a decision agreed to by any two of the three (your appraiser, the insurer’s appraiser, or the umpire) sets the amount of loss.

Important: Appraisal details can vary by policy and state. For example, Washington enacted a right-to-appraisal requirement for many first-party physical damage auto policies effective January 1, 2026, including timelines, “disinterested” appraiser standards, and cost-sharing language (RCW 48.18.620).

Quick tip: Before you pay for an appraiser, ask the insurer for the full valuation packet (comparables, adjustments, condition report) or the estimate line notes. Many disputes get resolved once both sides are looking at the same underlying data.

What an Appraisal Can and Cannot Decide

Think of appraisal as a tool that answers one main question: “What is the amount of this covered loss?”

Usually within scope: repair cost (scope and pricing), ACV/market value for total losses, sometimes related items like condition adjustments or options.
Usually outside scope: whether the loss is covered, policy interpretation, fraud allegations, late reporting disputes, and who is legally at fault.

If the insurer says the issue is “coverage,” ask them to put that position in writing. Appraisal is typically most appropriate when coverage is accepted but the amount is disputed.

How to Prepare for a Successful Appraisal

Your appraiser can only argue what they can support. The best prep is simple documentation:

Photos and videos: pre-loss condition (if you have it), damage close-ups, interior, tires, odometer, VIN label.
Maintenance and repair records: especially recent major work (tires, brakes, hybrid battery, timing belt, etc.).
Receipts for upgrades: OEM options, audio, wheels/tires—be realistic about what adds resale value.
Comparable listings: same year/trim, similar mileage, similar condition, in your region (your insurer may prioritize local market).
Shop documentation (repair disputes): teardown photos, supplements, OEM procedure citations, calibration requirements, parts invoices.

Also ask your appraiser how they’ll present the findings. A clear report that explains why the number is higher is usually more persuasive than a single bottom-line figure.

How Total-Loss Value Is Usually Determined

For total losses, insurers usually start with actual cash value (ACV), which is generally tied to the vehicle’s fair market value immediately before the loss (then apply your deductible and any applicable adjustments). Some state regulators publish consumer definitions—for example, California’s Department of Insurance explains ACV as fair market value unless your policy defines it differently (California DOI Auto Insurance Terms).

States can also set rules about the valuation methods insurers may use. For example, Florida’s claims settlement statute lists ways a carrier may derive the cost to purchase a comparable vehicle, including local comparable vehicles, recognized used-vehicle sources (including databases/guidebooks), or dealer quotes (Florida Statutes § 626.9743).

If you’re disputing ACV, focus on the items that move the number in a defensible way: verified trim/options, documented condition, mileage accuracy, and truly comparable vehicles. If the valuation used the wrong trim, missed major options, or over-penalized condition, those are concrete correction points.

If You Still Can’t Reach a Fair Settlement

If appraisal isn’t available, doesn’t apply to your dispute, or still doesn’t resolve things, your options often include:

Request a supervisor review: ask for a written explanation of the offer and the data behind it.
Use state help resources: many state insurance departments offer complaint pathways or dispute assistance.
Consider mediation or legal advice: depending on claim size and your state’s rules.

As an example of how regulators frame total-loss disputes, the Illinois Department of Insurance describes common valuation sources and notes that some situations may be concluded under the policy’s appraisal section (Illinois DOI: Total Loss Auto Claims).

Trusted Consumer Resources

If you want a regulator-focused overview of coverages and shopping basics, the NAIC’s consumer guide is a solid starting point (NAIC Consumer’s Guide to Auto Insurance). For claim-settlement and negotiation guidance, some state agencies also publish plain-language help pages—Florida’s consumer auto insurance overview is one example (Florida DFS: Personal Automobile Insurance Overview).

Insurance rules and claim procedures vary by state and by policy form. This article is educational and not legal advice. If you’re facing a high-dollar dispute, consider getting guidance from a licensed professional in your state.

FAQs on Car Insurance Appraisals

Is a car insurance appraisal the same as the adjuster’s estimate?

No. An adjuster’s estimate is the insurer’s starting point for repairs or valuation. A claim appraisal is a more formal dispute process used when you and the insurer can’t agree on the dollar amount of a covered loss.

When can I request an appraisal?

Typically after you and the insurer agree the claim is covered but reach an impasse on the amount of loss (repair cost or actual cash value). Your policy may require a written demand and may set timelines—check the appraisal clause in your policy.

Who pays for the appraisers and the umpire?

Often, each side pays its own appraiser and splits the umpire cost, but the exact arrangement depends on your policy and state law. Ask for the cost language in writing before you proceed.

Can appraisal be used for total-loss value disputes (ACV)?

In many cases, yes—especially when the dispute is strictly about the vehicle’s pre-loss value or the amount owed. Some states and policy forms are more explicit than others, so confirm your policy’s wording and any state-specific requirements.

Does appraisal decide coverage or who was at fault?

Usually no. Appraisal is generally limited to the amount of loss. Coverage questions (exclusions, policy interpretation) and liability/fault disputes are typically handled outside appraisal through the claims process, mediation, or courts.

How long does the appraisal process take?

It varies by claim complexity, scheduling, and any policy or state timelines. Some disputes resolve quickly once appraisers exchange reports; others take longer if an umpire is needed.

What if I still disagree after the appraisal award?

Options depend on your policy and state law. You can request a written explanation of the award and confirm what it covers. If you believe there are procedural problems or a separate coverage issue, you may be able to escalate internally, file a complaint with your state insurance department, or seek legal advice.