News Summary
Rhode Island has introduced a new appraisal law aimed at expediting vehicle damage evaluations. Signed by Governor Daniel McKee, the legislation mandates that insurance appraisers inspect damaged vehicles within four days of a request. The law also provides mechanisms for resolving appraisal discrepancies and aims to improve the overall claims process for consumers, enhancing transparency and efficiency in vehicle repairs. This aligns Rhode Island with similar laws in states like Washington and Texas, reflecting a push for stronger protections for vehicle owners.
Rhode Island Implements New Appraisal Law to Expedite Vehicle Damage Evaluations
Rhode Island has implemented a new appraisal law, signed by Governor Daniel McKee, aiming to streamline the process for vehicle damage claims. The legislation, introduced as bill HB 6054, was passed rapidly through the state legislature, becoming effective immediately upon the governor’s signing on July 2.
Under the new law, insurance company appraisers are now required to inspect damaged vehicles within four days of receiving a written request from the vehicle owner. This timeline slightly extends from the previous three-day period stipulated by prior regulations.
Should an insurance appraiser fail to meet this four-day deadline, they forfeit the right to assess the vehicle before any repairs commence. Once this deadline has passed, negotiations between the insurer and the repair shop will be restricted primarily to the costs of labor and parts, unless the insurer presents objective evidence that challenges the stated damage or repair methods.
The legislation introduces a new mechanism for resolving differences in damage evaluations. If appraisers begin to disagree on the degree of loss, and their estimates differ by 15% or less, the final amount will default to the average of their proposals. However, when discrepancies exceed this threshold, the appraisers must submit three names of impartial licensed appraisers within three days. One of these names will be chosen to serve as the umpire, who will arbitrate the final decision.
If the two appraisers cannot agree on their choice of umpire, an independent arbitration association, such as the American Association of Arbitrators, will appoint one. The appointed umpire has five days to deliver a decision regarding the loss amount.
Additionally, the law addresses the costs associated with the appraisal process. In scenarios where the final approved amount surpasses the insurer’s initial offer by more than 25%, the insurer is required to cover the total appraisal costs. Conversely, if the final amount is less than this 25% threshold, the arbitration costs will be divided between both parties involved.
The decisions made by the appointed umpire are binding, which means that neither party can contest the ruling based on claims for hidden damage or increases in parts pricing that were not initially accounted for.
This newly enacted law puts Rhode Island in line with a growing trend seen in other states, including Washington and Texas, which have recently passed similar right-to-appraisal laws. These laws have emerged from grassroots advocacy efforts seeking to protect vehicle owners, though some states have faced challenges in modifying insurance company obligations within their laws.
In contrast, recent appraisal-related legislation in neighboring New Jersey is still under review in committee, leaving its future uncertain.
The swift passage of this legislation reflects an increasing urgency among Rhode Island lawmakers to address concerns over vehicle damage evaluations and improve the overall claims process for consumers. The new rules are set to improve transparency and expediency in vehicle repair and damage assessments, ultimately benefiting car owners throughout the state.
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