Short Answer

In North Carolina, an appraisal clause is a contract tool insurers use to resolve disputes about the amount of property damage—not who is at fault or whether coverage applies. In a third-party claim against the at-fault driver’s insurer, you are not a party to that policy and generally cannot be forced into appraisal. If you agree to appraisal, each side picks a disinterested appraiser, they select an umpire, and an award by any two typically binds the amount of loss. Direct all adjuster communications to your attorney.

Understanding the Problem

You’re pursuing a North Carolina property-damage claim for diminished value after a crash. The at-fault driver’s insurer may say it will invoke an appraisal clause to set the “amount of loss,” even though you already obtained an independent appraisal. You want to know what happens next and whether you should deal directly with the adjuster or route everything through your lawyer.

Apply the Law

Under North Carolina law, appraisal is a private, contract-based process used to decide the dollar value of loss. It does not decide liability or coverage. For first-party claims, policies commonly allow either side to demand appraisal; each side names a disinterested appraiser, the appraisers try to agree, and if they cannot, they select an umpire who breaks the tie. In a third-party claim (a claim against the at-fault driver’s insurer), you are not bound by the at-fault driver’s policy. If you consent to use appraisal anyway, expect a neutral, value-only determination. Courts can be asked to help if the appraisers cannot agree on an umpire. North Carolina courts also require mediation in most Superior Court civil cases before trial if a lawsuit is filed.

Key Requirements

• Scope is limited: Appraisal decides only the amount of loss; it does not decide fault or coverage.
• Who can demand it: Only parties to the policy can compel appraisal; third-party claimants may decline.
• Neutral selection: Each side picks a disinterested appraiser; those appraisers choose an umpire if they disagree.
• Cost-sharing: Each side pays its own appraiser; the umpire’s fee is typically split.
• Binding amount (with caveats): An award signed by any two neutrals usually binds the amount of loss, absent fraud or clear mistake; liability and coverage issues remain open.
• Forum and timing: If appraisers cannot agree on an umpire, a short petition in Superior Court can be used to seek a court appointment; policy timelines for naming appraisers are common and must be checked.

What the Statutes Say

• North Carolina Gen. Stat. § 58-44-16 (Standard property policy form) – Recognizes appraisal to resolve amount-of-loss disputes in property insurance policies.
• North Carolina Gen. Stat. § 7A-38.1 (Mediated settlement conferences) – Requires mediation in most Superior Court civil cases before trial.

Analysis

Apply the Rule to the Facts: You are making a third-party diminished-value claim against the at-fault driver’s insurer. Because you are not a party to that policy, the insurer generally cannot require you to use its appraisal clause. If you agree to appraisal, your lawyer will select a qualified, disinterested appraiser and handle communications. The process will set a number for loss but will not resolve fault, coverage, or any other injury claims.

Process & Timing

1. Who files: If you consent to appraisal, your attorney sends a written demand or acceptance and names your appraiser per your policy or written agreement. Where: To the insurer (claims department). What: Follow the policy’s appraisal clause language (deadlines often require naming an appraiser within a short window). When: Check the policy; many require prompt action.
2. If appraisers disagree, they attempt to select an umpire. If they cannot, your attorney may file a brief petition in Superior Court asking the court to appoint an umpire. Timeframes vary by county and court calendars.
3. Two of the three neutrals (either both appraisers or one appraiser plus the umpire) sign a written award stating the amount of loss. The insurer then processes payment consistent with the award and any applicable coverage limits and deductions. In a third-party claim, the award can be used to value the loss but does not waive fault or coverage arguments.

Exceptions & Pitfalls

• Third-party status: You cannot usually be compelled into the at-fault driver’s appraisal process; do not assume you’re required to participate.
• Scope creep: Appraisal sets value only; it does not decide coverage or liability. Reserve those rights in writing.
• Communication risk: Once represented, do not give statements or negotiate directly with the adjuster; refer all contact to your lawyer.
• Evidence preservation: Do not repair or sell the vehicle until both sides’ appraisers have inspected it, or you risk undermining your valuation.
• Deadlines: Policy appraisal timelines and the civil statute of limitations can both affect your rights; missing either can limit recovery.

Talk to a Personal Injury Attorney

If you’re facing a North Carolina diminished-value dispute and an insurer is pushing appraisal, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.