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SB 512

AUTOMOBILE INSURANCE: Creates a mandatory right of appraisal for automobile repairs. (8/1/26)

2026 Regular Session Introduced by Stewart Cathey

Louisiana SB 512 mandates an independent appraisal for auto repair claim valuations, with a three-person panel and a neutral umpire, effective Aug 1, 2026.

Read second time by title and referred to the Committee on Insurance.
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Bill Summary · SB 512

Legislative Bill Summary – Louisiana SB 512 (2026)

Overview

  • Bill: SB 512
  • Session: 2026 Regular Session
  • Jurisdiction: Louisiana
  • Subject: Automobile insurance; establishes a mandatory right of appraisal for automobile repairs
  • Effective Date: August 1, 2026
  • Introduced by: Senator Cathey

Main Purpose

SB 512 creates a mandatory right of appraisal for automobile insurance policyholders to resolve disputes over the valuation of automobile repair claims. It requires all automobile insurance policies issued in Louisiana to include an appraisal clause and sets the structure and process for how appraisal is to be conducted.

Key Provisions

  • Mandatory Right of Appraisal (new law: R.S. 22:1289.2)

    • Every automobile insurance policy issued in Louisiana must include an appraisal clause.
    • Purpose: Allow policyholders to challenge and resolve disputes over claim valuations for auto repairs through an independent appraisal process.

  • Appraisal Process Components

    • Three-person panel:
    • One appraiser chosen by the insurer
    • One appraiser chosen by the policyholder
    • One neutral umpire
    • The process is designed to be bipartisan, with each side appointing an appraiser and a neutral third party to render a final decision if the two appraisers cannot agree.

  • Process Alignment with Existing Law

    • The appraisal framework must follow the procedures provided in R.S. 22:1807.13 and 1807.19, which govern similar appraisal mechanisms in Louisiana (e.g., claims or other policy disputes). This ensures consistency with existing statutory procedures for appraisal disputes.

Who Is Affected

  • Automobile Insurance Policyholders: Individuals and entities with auto insurance policies in Louisiana gain a new avenue to dispute and resolve claim valuation disagreements through appraisal.
  • Insurance Companies: Insurers must include the appraisal clause in all auto policies and participate in the appraisal process by providing an appraiser and complying with the process.
  • Neutral Umpire/Appraisers: An umpire and two appraisers (one for each side) will participate in the resolution of disputed valuations.

Procedural and Timeline Details

  • Effective Date: August 1, 2026 (policy language updates and implementation expected)
  • Implementation: Requires modification of all automobile insurance policies to insert the mandatory right-to-appraisal clause.
  • Process Timing: The bill outlines a formal appraisal process, consistent with existing Louisiana appraisal statutes, though specific timelines (e.g., deadlines for appointing appraisers, timelines to issue decisions) would be governed by the referenced statutes (R.S. 22:1807.13 and 1807.19).

Practical Implications

  • The change provides policyholders with a structured, independent mechanism to challenge auto repair valuation disputes, potentially reducing litigation costs and speeding resolution.
  • Insurers must budget for potential appraisal costs and manage internal processes to select appraisers while ensuring fairness and compliance with the statutory framework.
  • The neutral umpire serves as a tie-breaker to finalize decisions when appraisers disagree.

Summary

SB 512 establishes a mandatory right to an independent appraisal for automobile repair claim valuations, requiring insurers to include an appraisal clause in all auto policies and outlining a three-party process (insurer appraiser, policyholder appraiser, and a neutral umpire) consistent with existing appraisal statutes. The bill takes effect August 1, 2026.

Compiled from official sources — confirm details with the bill’s official record.

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