Appraisal guide · Decide
Independent appraisal vs the insurer’s diminished value offer
An insurer’s diminished value offer usually comes from a formula or an in-house review, prepared by the company that has to pay the claim. An independent appraisal is prepared for you and measures the loss with comparable vehicles. Before accepting an offer, ask the adjuster how the number was calculated and compare it with market evidence.
By the Autoloss team · Reviewed by Monica Fisher · Published
How insurers arrive at an offer
Practices vary by company, but offers tend to come from one of three places:
- A formula. The best known is covered in our 17c formula guide. It is fast and consistent, and it does not look at the market for your vehicle.
- An in-house or vendor review. A staff appraiser or an outside vendor hired by the insurer gives an opinion, sometimes with little explanation.
- A flat denial. Some adjusters start from the position that a properly repaired vehicle has lost nothing.
The differences that matter
| Insurer’s offer | Independent appraisal | |
| Prepared for | The company paying the claim | You |
| Basis | Often a formula or a brief opinion | Comparable vehicles with and without accident history |
| Your repair records | May reduce the damage to a single multiplier | Reviewed line by line |
| Shown to you | Often only the final number | The comparables, the adjustments and the reasoning |
| Binding? | No. It is an offer. | No. It is evidence. |
Five questions to ask the adjuster
- How was this figure calculated? Please send the calculation in writing.
- What pre-accident value did you start from, and where did it come from?
- Which comparable vehicles, if any, did you use?
- How did you account for the structural or frame repairs on my invoice?
- Does accepting this payment require me to sign a release, and what does the release cover?
The answers tell you whether the offer rests on evidence you can check.
When the offer may be reasonable
An insurer’s offer is not wrong just because the insurer made it. On an older vehicle with light damage, a modest offer can be close to the real loss. If the offer is in line with your own quick checks, accepting it may be the sensible choice. Our guide on whether an appraisal is worth it helps with that judgment.
When to get your own evidence
- The offer is a formula result and your vehicle is newer or higher-value.
- The adjuster will not explain the number.
- Your invoice shows structural repairs and the offer treats the damage as minor.
- The claim was denied outright.
An independent report does not force the insurer to pay. It replaces an argument about opinions with a set of comparable vehicles and stated adjustments, which the adjuster then has to address. If the insurer questions the report, we answer questions about how it was prepared. We do not negotiate the claim; you, or your attorney, do that.
What to do with the report once you have it is in what happens after your appraisal.
Common questions
Does the insurer have to accept my appraisal?
No. An appraisal is evidence, and the insurer makes its own decision. If you cannot agree, your options depend on your state and can include small claims court, an attorney, or a complaint to the insurance department.
Can I accept the insurer’s offer and still claim more later?
Usually not if accepting requires a release. Read the release carefully, and ask an attorney if you are unsure what it covers.
Will the insurer pay for my appraisal?
Sometimes it is reimbursed as part of a settlement, and you can ask. Do not count on it when deciding whether to order.
Keep reading
More from the appraisal guide
Decide
How much does a diminished value appraisal cost?
The fee, what it includes, what changes it, and when you pay.
Decide
Is a diminished value appraisal worth it?
Compare the likely loss with the fee, and know when to skip it.
Decide
Can you document diminished value yourself?
How to build your own evidence, where it falls short, and when to pay.
Not sure whether an appraisal will help?
The claim review is free: we look at your situation and tell you whether an appraisal is likely to help. The appraisal itself is a paid report. We help from start to finish, including a custom demand letter, and our support staff is a phone call away throughout the process.