2025-2026 Auto Insurance Law Updates: Texas SB 458 & More
New legislation is changing the landscape for auto claims. Read about Texas Senate Bill 458 and new umpire rules in Washington state.
Texas Senate Bill 458: Mandatory Appraisal Clauses
In a major win for consumer protection, the Texas Legislature passed Senate Bill 458, which was signed into law in 2025. This legislation addresses a growing trend where some insurance carriers were removing appraisal clauses from their policies to prevent policyholders from disputing low offers.
Key Provisions:
- Mandatory Inclusion: All personal auto and residential property insurance policies issued or renewed in Texas on or after January 1, 2026, MUST include an appraisal provision.
- Right to Dispute: This ensures that every Texan has the contractual right to demand an independent appraisal if they disagree with their insurer's valuation of a loss.
- Binding Nature: The law reaffirms that the appraisal award is binding on all parties as to the amount of loss.
This law effectively stops insurers from stripping away a policyholder's right to a fair, independent valuation mechanism.
Washington State: Umpire Registration Rules
Washington state has also implemented new consumer protections regarding the appraisal process. The Office of the Insurance Commissioner has established new rules for registering and identifying umpires.
Why It Matters:
Previously, the selection of an umpire could be a contentious process, with concerns about bias. The new rules require:
- Registry: The Insurance Commissioner will maintain a registry of competent and disinterested umpires.
- Transparency: If appraisers cannot agree on an umpire, they can request a list of qualified individuals from the state registry.
- Fairness: This helps ensure that the "tie-breaker" in the appraisal process is truly neutral and not beholden to insurance companies.
What This Means for You
These legislative updates signal a shift towards greater accountability for insurance companies. Lawmakers are recognizing that the "take it or leave it" approach to claims settlement is unfair. If you are in Texas or Washington, these new laws provide you with stronger legal footing to demand fair compensation for your total loss or diminished value claim.