FILING APPRAISAL NOT LAWSUIT PREREQUISITE

410_C168

FILING APPRAISAL NOT LAWSUIT PREREQUISITE

Automobile

Appraisal

Valuation

 

Kerry Hanke purchased an auto policy from American International South Insurance Company. The policy covered his 1991 Dodge Ram truck and was in force at the time of an accident in which the truck was declared a "total loss" by the insurance company. The valuation was made by the ADP Claims Solution Group. The adjuster for the company offered $4,500, but it was refused by the insured.

The insured told the adjuster her valuation was too low because he had just installed a new engine in the truck. She told him that the policy provided for appraisal by an appraiser selected by the company and another chosen by the insured. The two appraisers would select an umpire.

The insured replied by sending a Kelley Blue Book valuation in the amount of $6,805, a copy of the bill showing the installation of the new engine, and a copy of a repair bill for the installation of heavy-duty shock absorbers on the truck. The company refused to increase the settlement, and the insured filed this class action, contending the company fraudulently used valuation reports that undervalued the actual cash value of vehicles which were declared total losses.

The company demanded an appraisal and the trial court denied the demand. The company filed this appeal.

The company contended its policy required the insured to submit to an appraisal before filing suit.

The trial court found that the insured was not required to submit to the appraisal process before filing suit, and its judgment was affirmed. The higher court pointed out that the company could get an appraisal as part of the discovery process.

The judgment of the lower court in favor of the insured was affirmed, and the action was remanded for further proceedings.

Kerry Hanke, Individually and on Behalf of All Others Similarly Situated v. American International South Insurance Company, Appellant-No. 5-01-0919-Appellate Court of Illinois, Fifth District-December 26, 2002-782 North Eastern Reporter 2d 328.