A New Jersey bill would require all auto insurers in the state to include appraisal provisions in their policies for certain claims and settlement disputes.
Assembly Bill No. 6106 was introduced on November 24, 2025, in the 221st New Jersey Legislature. The bill is sponsored by Rep. Dan Hutchison and Rep. Cody D. Miller. It applies to every automobile insurer authorized to write automobile insurance policies in New Jersey and to policies issued, executed, renewed, or delivered to a consumer in the state.
Under the bill, each policy must contain a provision allowing an appraisal by a “competent and disinterested appraiser” if the policyholder and insurer disagree on the actual cash value or amount of a loss to an automobile reported on a claim, including both repairable and total loss amounts, or on the offer of settlement to a third‑party liability claim.
The same appraisal provision would also apply to a third‑party claimant if the claimant and the insurer disagree on the actual cash value or amount of a loss reported on a claim that is used to determine the valuation of an offer of settlement.
The process begins once there is a disagreement after the automobile has been inspected and given an estimate of the actual cash value or amount of loss by an automobile body repair shop selected by the policyholder, or when there is a disagreement on the offer of settlement to a third party. At that point, either the policyholder or the insurer may submit a written demand letter to the other party invoking the appraisal provision and selecting a competent and disinterested appraiser.
The party receiving the written demand has 20 calendar days to notify the other party of the appraiser they have selected. The two appraisers then have 20 business days to appraise the loss and to state separately the actual cash value and amount of loss, or the offer of settlement.
If the appraisers do not agree on the actual cash value and amount of loss, or on an appropriate offer of settlement, they must submit documentation memorializing their differences, including the actual cash value and amount of loss as calculated by each appraiser, to a competent and disinterested umpire. The umpire is to be selected by the appraisers, or, if the appraisers fail to agree on an umpire within 15 calendar days, by a judge in a court of competent jurisdiction at the request of either party.
After reviewing the submitted documentation, including each appraiser’s statement of the actual cash value and amount of loss, the umpire, or the judge where applicable, issues an award to one of the appraisers selected by the parties. That award is then filed with the insurer.
The bill defines a “competent and disinterested appraiser” as an appraiser who is impartial and without a financial interest in the opposing party when conducting an appraisal on behalf of an insurer, policyholder, or third‑party claimant. “Offer of settlement” is defined as a formal offer to settle a third‑party liability claim filed by an individual other than the policyholder or insurer. A “third‑party liability claim” is defined as a liability claim filed by an individual other than the policyholder or insurer.
If enacted, the act would take effect on the 90th day next following enactment and would apply to claims filed and offers of settlement made on or after that date. For insurance professionals, the measure would make appraisal rights a built‑in component of New Jersey auto policies and set clear timelines and roles for appraisers, umpires and, in some cases, the courts when resolving valuation disputes.
