Contingency Fees in Insurance Appraisal by State
Whether appraisers and umpires may be paid based on the outcome of the award, and how appraisal costs are shared between the parties.
7 states have a researched rule on contingency fees, drawn from statutes and court decisions, with 1 court decisions on the subject. Other states are not yet reviewed.
| State | Rule |
|---|---|
| California | Each side pays its appraiser; umpire shared |
| Colorado | Contingent-cap fee not partial per se |
| Illinois | No financial interest (auto) |
| Iowa | Contingency fees prohibited |
| Louisiana | Contingency fees prohibited |
| Oklahoma | Each side pays its appraiser; umpire shared |
| Texas | TWIA: costs shared equally |
California
Each side pays its appraiser; umpire shared. "Each appraiser shall be paid by the party selecting him or her and the expenses of appraisal and umpire shall be paid by the parties equally" (Ins. Code §2071, Appraisal). AUA has not yet reviewed California law on contingency fees for appraisers.
Full California entry · verified October 20, 2026
Colorado
Contingent-cap fee not partial per se. In Dakota Station, the court declined to hold that a contingent-cap fee agreement (capping the appraiser's fee at five percent of the award) rendered the appraiser partial as a matter of law. Neither party believed the cap applied, and the billed fees bore no apparent relation to the appraiser's estimates. The court said it was "wary of the possible incentives these agreements create."
- Court decision Owners Insurance Co. v. Dakota Station II Condominium Ass'n (2019 CO 65, 2019)
Full Colorado entry · verified October 20, 2026
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).
Full Illinois entry · verified October 20, 2026
Iowa
Contingency fees prohibited. An appraiser or umpire "shall not charge any party on a basis dependent on the outcome" of the award, or through barter, gifts or favors (§522F.6(2), §522F.11(3)). No fee is owed if the appraiser or umpire abandons the appraisal before the award. Each party pays its own appraiser and an equal share of umpire fees and appraisal costs.
Full Iowa entry · verified October 20, 2026
Louisiana
Contingency fees prohibited. Parties may not pay an appraiser or umpire "on a contingent fee basis, percentage of the decision, barter arrangement, gift, favor, or in-kind exchange" (La. R.S. 22:1807.23(C); see also §1807.16(E), §1807.20). Each party pays its own appraiser and half of the umpire's fees and appraisal costs; no umpire fee is owed if the parties settle before the umpire begins work. A Commissioner-selected umpire charges an hourly rate set by the Commissioner (§1807.21).
- Statutes La. R.S. 22:1807.23 (Costs); La. R.S. 22:1807.16 (Appraiser obligations); La. R.S. 22:1807.21 (Additional obligations for commissioner-selected umpires)
Full Louisiana entry · verified October 20, 2026
Oklahoma
Each side pays its appraiser; umpire shared. "Each appraiser shall be paid by the party selecting him and the expenses of appraisal and umpire shall be paid by the parties equally" (36 O.S. §4803(G)).
Full Oklahoma entry · verified October 20, 2026
Texas
TWIA: costs shared equally. For a TWIA appraisal, the claimant and the association "are responsible in equal shares for paying any costs incurred or charged in connection with the appraisal," including any umpire-roster fee (Tex. Ins. Code §2210.574(d)(2)). TWIA claims only.
Full Texas entry · verified October 20, 2026
Other subjects: State license · Impartiality · Umpire selection · Causation · Coverage · Award · Deadlines
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".
Frequently asked questions
Can appraisers or umpires be paid based on the outcome in California?
Each side pays its appraiser; umpire shared. "Each appraiser shall be paid by the party selecting him or her and the expenses of appraisal and umpire shall be paid by the parties equally" (Ins. Code §2071, Appraisal). AUA has not yet reviewed California law on contingency fees for appraisers.
Can appraisers or umpires be paid based on the outcome in Colorado?
Contingent-cap fee not partial per se. In Dakota Station, the court declined to hold that a contingent-cap fee agreement (capping the appraiser's fee at five percent of the award) rendered the appraiser partial as a matter of law. Neither party believed the cap applied, and the billed fees bore no apparent relation to the appraiser's estimates. The court said it was "wary of the possible incentives these agreements create."
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).
Can appraisers or umpires be paid based on the outcome in Iowa?
Contingency fees prohibited. An appraiser or umpire "shall not charge any party on a basis dependent on the outcome" of the award, or through barter, gifts or favors (§522F.6(2), §522F.11(3)). No fee is owed if the appraiser or umpire abandons the appraisal before the award. Each party pays its own appraiser and an equal share of umpire fees and appraisal costs.
Can appraisers or umpires be paid based on the outcome in Louisiana?
Contingency fees prohibited. Parties may not pay an appraiser or umpire "on a contingent fee basis, percentage of the decision, barter arrangement, gift, favor, or in-kind exchange" (La. R.S. 22:1807.23(C); see also §1807.16(E), §1807.20). Each party pays its own appraiser and half of the umpire's fees and appraisal costs; no umpire fee is owed if the parties settle before the umpire begins work. A Commissioner-selected umpire charges an hourly rate set by the Commissioner (§1807.21).
Can appraisers or umpires be paid based on the outcome in Oklahoma?
Each side pays its appraiser; umpire shared. "Each appraiser shall be paid by the party selecting him and the expenses of appraisal and umpire shall be paid by the parties equally" (36 O.S. §4803(G)).
Can appraisers or umpires be paid based on the outcome in Texas?
TWIA: costs shared equally. For a TWIA appraisal, the claimant and the association "are responsible in equal shares for paying any costs incurred or charged in connection with the appraisal," including any umpire-roster fee (Tex. Ins. Code §2210.574(d)(2)). TWIA claims only.