Appraisal and Arbitration
When a home or business is damaged and the claim reaches an impasse, the appraisal process in most commercial and residential insurance policies can be a valuable dispute resolution method to resolve a claim.
Appraisal is a Policy Provision found in the Loss Settlement section. It is an Alternate Dispute Resolution, which can resolve disagreements when the Insurance Company and Policyholder do not agree on the amount of loss. It is an alternative to a lawsuit.
Coastal Claim Consultants appraisers have handled hundreds of appraisals ranging from small residential losses to commercial losses in excess of $7 million. Our certified appraisers will assess and evaluate the damage and provide an impartial, informed estimate of the value of the loss. Our appraisers have acquired the foremost appraiser and umpire certifications from the Insurance Appraisal and Umpire Association (I.A.U.A.), The Property Loss Appraisal Network (P.L.A.N.) and Windstorm Insurance Network (WIND).
When is appraisal appropriate?
Sometimes there is a disagreement over the insurance company's valuation of an insurance claim. Policyholders often think the only way to settle the dispute is to hire a lawyer. Fortunately, this is not the case. Appraisal is a method of Alternative Dispute Resolution often found in many homeowner and commercial insurance policies.
The language will often, but not always, state that appraisal is mandatory when properly demanded by the insurer or insured. It is important to have a qualified Appraiser review your policy to determine your options.
When properly executed, appraisal is binding on the parties as to the amount of loss only. Appraisal does not determine coverage. If not properly invoked, employed, and/or carried out the process may not be binding, so it is important to select a qualified appraiser and umpire.
How does the Insurance Appraisal Process Work?
Once the Appraisal clause/provision is invoked, time is of the essence. Both the insurance company and the insured are required to inform the other party of their named appraiser within 20 days. Once the appraisers are selected they are required to select a mutually agreed upon Umpire. If the two parties cannot agree to an Umpire, the court will petitioned and select and Umpire. The insured's appraiser and the insurance carrier's appraiser will then estimate the damage and try to come to an agreement on the amount of loss.
If the appraisers fail to agree, they will submit their differences to the Umpire. An itemized decision agreed to by two of these three will set the amount of loss. Such award shall be binding.
Each party will pay its own appraiser. The cost of the Umpire and any appraisal related expenses will be split equally between the insured and insurance company.
