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Ask Our Lawyer - June 2001

Q: Last month, I told you about my insurance company. They only want to pay me book value for my highly customized, but now stolen, bike. Is there any way I can convince the insurance company to re-evaluate their offer?

A: As we noted last month, there may be ways to do that, but it will depend on how good your records are. Last month, we talked about verifying the modifications done to the bike and documenting the value of the changes. These documents can be used to verify the value of the bike and support your claim. However, some insurance companies might still not change the offer, even with the documentation.

Fortunately, most insurance contracts have provisions that allow you to challenge, after a fashion, the insurance company's valuation. This provision allows the insured (that's you) to request an appraisal proceeding. Basically, the provisions generally allow each party to pick an appraiser, who will evaluate the value of the bike. If those appraisers agree, the insurance company should accept that valuation. (Whether you or the insurance company must accept the appraisal will be set forth in the contract provisions in your insurance contract.)

If the appraisers do not agree on a valuation for the bike, they will agree to appoint a third appraiser who will meet with the appraisers, review the appraisals, evaluate the bike and assign a value. most appraisal provisions read that where your appraiser and the insurance company's appraiser can't agree on the value, and they choose a 3rd appraiser, an agreement by two settles the case. What usually happens is that if the 3rd appraisal doesn't match one of the other two, the 3rd appraiser and one of the others will come to an agreed price, usually a compromise between those two.

There are a number of places where you would be able to find and hire an appraiser. The most likely place would be a licensed dealer for the brand of bike you have. If you can't find anyone there, you might try an established repair shop or a used bike dealer. Make sure your appraiser will actually consider the modifications made to the bike and the market for the bike, not just book value.

If you have any questions you would like to ask the lawyer, please submit them to: ASK OUR LAWYER, P.O. Box 2850, Indianapolis, Indiana 46206-2850, or email to brianshadiow@abatelegal.com.