Specialty Claims — Expert Insights for Trusted Outcomes

Insurance Appraisal Simplified

When there’s a disagreement between a homeowner (the insured) and their insurance company (the insurer) about how much damage occurred or how much a loss is worth, the appraisal process can help resolve it fairly and efficiently without going to court.

STEP 1 — A Dispute Arises

A dispute occurs over the value or extent of damage covered by an insurance policy.

For example: The homeowner’s contractor says the roof damage costs $40,000 to fix.

The insurance company only offers $20,000.

When the difference can’t be resolved through discussion, either party can invoke appraisal under the policy.

STEP 2 — Each Party Selects an Appraiser

• Both sides choose their own independent appraiser.

• The insurance company selects one.

• The policyholder selects another (often someone with construction or insurance expertise).

The two appraisers then jointly agree on a neutral third person called an umpire.

If they can’t agree on an umpire, a court can appoint one.

STEP 3 — Appraisers Review and Compare

The two appraisers review all documentation, estimates, and evidence.

They try to agree on as many items as possible — such as material costs, repair methods, or replacement values.

STEP 4 — Unresolved Issues Go to the Umpire

If the appraisers cannot agree on certain items, those remaining issues are submitted to the umpire.

All three professionals (the two appraisers and the umpire) will then:

• Review photos, reports, and evidence

• Conduct inspections if necessary

• Discuss and evaluate the facts objectively

STEP 5 — Reaching a Decision

A valid appraisal award is made when any two of the three (the two appraisers and the umpire) agree on the outcome.

The decision can be:

2 out of 3 agree → Decision stands

3 out of 3 agree → Unanimous award

The agreed-upon findings are written, signed, and called the Appraisal Award.

STEP 6 — Delivering the Award

The completed Appraisal Award is sent to: The insurance company, and the policyholder

This triggers payment or enforcement of the award amount according to the insurance policy.

Important Notes

The appraisal process cannot resolve coverage disputes, it only determines the value of the loss.

Rules for appraisal vary by state, including appraiser qualifications and procedures.

Once confirmed by a court, the appraisal award becomes legally enforceable similar to a judgment.

In Summary

The insurance appraisal process provides a structured, professional, and efficient way to settle disputes over loss value without lengthy litigation. It’s a fact-based, expert-driven process that helps both sides achieve a trusted outcome.