Disclaimer: This article provides general information only and does not constitute legal advice. Consult a qualified attorney for advice on your specific situation.
Detailed Answer
When an insurer’s diminished value offer falls short, an appraisal clause can provide a binding resolution without going to court. Most Maryland auto insurance policies include an appraisal provision that allows you and the insurer to each select a neutral expert appraiser. Here’s how to invoke the appraisal clause under Maryland law and policy terms.
1. Review Your Insurance Policy
Locate the appraisal clause in your auto policy. It typically appears under sections titled “Appraisal” or “Dispute Resolution.” Note any deadlines, notice requirements, and procedures.
2. Provide Written Notice to the Insurer
Send a written demand for appraisal by certified mail or another traceable method. Your demand should reference the appraisal clause, identify the dispute (low diminished value offer), and state that you intend to invoke appraisal.
3. Select Your Appraiser
Within the timeframe set by your policy (often 20–30 days), choose a qualified appraiser experienced in vehicle diminished value. Provide the insurer with your appraiser’s name and contact information in writing.
4. Insurer Selects Its Appraiser
The insurer then appoints its own appraiser. If the insurer fails to select one within the prescribed time, you may ask a court to compel appraisal or proceed with your appraiser’s valuation, depending on policy language.
5. Appointment of an Umpire
If your appraiser and the insurer’s appraiser cannot agree on the diminished value amount, they will jointly select an umpire. If they cannot agree on an umpire within the policy deadline, either party can ask a judge to appoint one.
6. Conduct the Appraisal
The three decision-makers (your appraiser, the insurer’s appraiser, and the umpire) inspect the vehicle, review repair records, market data, and other evidence. They then submit written valuations of the diminished value.
7. Binding Appraisal Award
The insurer must pay the amount agreed upon by any two of the three. Under Maryland regulations, appraisal awards are binding and enforceable. See COMAR 31.05.03.16 (“Appraisal”) for details: COMAR 31.05.03.16.
8. Enforce the Award
If the insurer refuses payment, you can file a petition in the Maryland District Court to confirm the appraisal award as a judgment and collect the amount due.
Helpful Hints
- Obtain a full copy of your auto insurance policy before invoking appraisal.
- Document all communications with the insurer in writing and keep delivery receipts.
- Choose an appraiser with specific experience in diminished value assessments.
- Act promptly. Missing policy deadlines can waive your right to appraisal.
- Share all repair invoices, photos, and market comparables with your appraiser.
- Understand that you and the insurer share umpire fees equally unless your policy states otherwise.
- If the insurer delays selecting an appraiser or umpire, consider filing a court motion to compel appraisal.
- Consult the Maryland Insurance Administration website for guidance: insurance.maryland.gov.