Illinois Insurance Appraisal Law
Illinois gives auto policyholders a statutory right to appraisal from July 1, 2027, with short deadlines and a definition of "disinterested" that excludes any financial interest in the outcome. For property claims, the Second District has held that appraisal of the amount of loss necessarily includes some questions of causation, while coverage stays with the courts.
Scope: Entries marked (auto) come from 215 ILCS 5/398, which applies only to personal auto policies issued, renewed or delivered on or after July 1, 2027; they are not rules for home or commercial property claims. Entries marked (property) come from Illinois appellate case law on property policy appraisal clauses. AUA has not yet reviewed other Illinois property-appraisal topics.
Partially reviewed Review due Verified against the linked sources on October 20, 2026 · next review January 18, 2027
| Subject | Illinois rule | Authority and related decisions |
|---|---|---|
| Contingency fees | No financial interest (auto). Appraisers must be "disinterested", defined as having "no direct or indirect financial interest in the outcome of the appraisal." Each party pays its own appraiser and the umpire's cost is shared equally (215 ILCS 5/398). | Statutes 215 ILCS 5/398 (Right to appraisal, automobile) |
| Impartiality | Competent and disinterested (auto). "Competent" means relevant expertise, training and experience in automobile damage valuation and claims practices; the umpire must be neutral, competent and disinterested (215 ILCS 5/398(a)). | Statutes 215 ILCS 5/398 (Right to appraisal, automobile) |
| Umpire selection | Appraisers select; court appoints if no agreement (auto). If the appraisers do not agree on the loss within 5 business days, they jointly select an umpire; if they cannot agree on an umpire within 15 business days, either party may petition a court to appoint one (215 ILCS 5/398(b)(3)). | Statutes 215 ILCS 5/398 (Right to appraisal, automobile) |
| Causation | Some causation within appraisal (property). Xiang Zhao v. State Farm Fire & Casualty Co., 2025 IL App (2d) 240723 (homeowners hail claim): whether the hailstorm damaged the windows "is not an issue of coverage. It is an issue of loss." The court held that "[w]hile questions of law and coverage are to be decided by the court, resolving some questions of causation will be necessarily included in the appraisal process," and affirmed an order compelling appraisal. | Court decision Xiang Zhao v. State Farm Fire & Casualty Co., 2025 IL App (2d) 240723 Court decision Xiang Zhao v. State Farm Fire & Casualty Co. (2025 IL App (2d) 240723, 2025) |
| Coverage | Decided by the court (property). In Zhao, the court said questions of law and coverage are for the court. It also held that the insurer's late-notice defense did not prevent appraisal: under the policy's terms, neither party waived its contractual rights by entering appraisal, and the effect of the delay could be decided later if the case continued. | Court decision Xiang Zhao v. State Farm Fire & Casualty Co., 2025 IL App (2d) 240723 Court decision Xiang Zhao v. State Farm Fire & Casualty Co. (2025 IL App (2d) 240723, 2025) |
| Award | Any two of three; binding (auto). An agreement by any two of the three (both appraisers, or one appraiser and the umpire) is binding on all parties; a final award is due within 5 business days of the umpire's selection (215 ILCS 5/398(b)(4)-(5)). | Statutes 215 ILCS 5/398 (Right to appraisal, automobile) |
| Deadlines | 7 / 5 / 15 / 5 business days (auto). Name appraisers within 7 business days of the demand; appraisers have 5 business days to agree; 15 business days to agree on an umpire; final award within 5 business days of the umpire's selection (215 ILCS 5/398(b)). | Statutes 215 ILCS 5/398 (Right to appraisal, automobile) |
Not yet reviewed for Illinois: state license.
Illinois authorities by category
Statutes and legislation
- 215 ILCS 5/398 (Right to appraisal, automobile): Contingency fees, Impartiality, Umpire selection, Award, Deadlines
Administrative rules and codes
Regulator: Illinois Department of Insurance
Illinois court decisions
- Xiang Zhao v. State Farm Fire & Casualty Co. (2025 IL App (2d) 240723, 2025) (Illinois Appellate Court, Second District): Affirmed an order compelling appraisal of a homeowners hail claim. Whether the storm damaged the windows was a question of loss, not coverage; questions of law and coverage are for the court, but some questions of causation are necessarily included in appraisal. The insurer's late-notice defense did not prevent appraisal. Subjects: Causation, Coverage
Research, not legal advice. Each entry summarizes the linked statute, regulation, guidance or court decision as checked on the date shown. Laws change, policy wording controls, and courts in the same state can disagree. Read the source and consult a licensed attorney before relying on any entry. Coverage is not yet exhaustive: states marked "Not yet reviewed" have not been researched, not "no rule".
← All states · Illinois in the research library · Illinois decisions
Frequently asked questions
Can appraisers or umpires be paid based on the outcome in Illinois?
No financial interest (auto). Appraisers must be "disinterested", defined as having "no direct or indirect financial interest in the outcome of the appraisal." Each party pays its own appraiser and the umpire's cost is shared equally (215 ILCS 5/398).
What impartiality standard applies to appraisers in Illinois?
Competent and disinterested (auto). "Competent" means relevant expertise, training and experience in automobile damage valuation and claims practices; the umpire must be neutral, competent and disinterested (215 ILCS 5/398(a)).
How is the umpire chosen in Illinois if the appraisers cannot agree?
Appraisers select; court appoints if no agreement (auto). If the appraisers do not agree on the loss within 5 business days, they jointly select an umpire; if they cannot agree on an umpire within 15 business days, either party may petition a court to appoint one (215 ILCS 5/398(b)(3)).
Can an appraisal panel decide causation in Illinois?
Some causation within appraisal (property). Xiang Zhao v. State Farm Fire & Casualty Co., 2025 IL App (2d) 240723 (homeowners hail claim): whether the hailstorm damaged the windows "is not an issue of coverage. It is an issue of loss." The court held that "[w]hile questions of law and coverage are to be decided by the court, resolving some questions of causation will be necessarily included in the appraisal process," and affirmed an order compelling appraisal.
Can an appraisal panel decide coverage in Illinois?
Decided by the court (property). In Zhao, the court said questions of law and coverage are for the court. It also held that the insurer's late-notice defense did not prevent appraisal: under the policy's terms, neither party waived its contractual rights by entering appraisal, and the effect of the delay could be decided later if the case continued.
Is an appraisal award binding in Illinois, and how is it enforced?
Any two of three; binding (auto). An agreement by any two of the three (both appraisers, or one appraiser and the umpire) is binding on all parties; a final award is due within 5 business days of the umpire's selection (215 ILCS 5/398(b)(4)-(5)).
What appraisal deadlines apply in Illinois?
7 / 5 / 15 / 5 business days (auto). Name appraisers within 7 business days of the demand; appraisers have 5 business days to agree; 15 business days to agree on an umpire; final award within 5 business days of the umpire's selection (215 ILCS 5/398(b)).