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Many homeowners and business owners find themselves disagreeing with their insurance company’s analysis of their insurance claim. However, most are unaware that they can dispute the insurance company’s findings via the Insurance Appraisal Clause! Even though the policyholder (you) submits a contractor’s estimate, receipts for repairs or materials, or even photos showing damages that the insurance company did not include for repairs… they still won’t budge.

Most policyholders are unaware of how to dispute and resolve their claim with the insurance company. Policyholders have a choice and a voice within their policy for this very purpose. It’s called The Appraisal Clause – also know as The Appraisal Provision. Now, don’t let this scare you. It may seem like a fancy clause that would take a law degree to understand. However, a simple way to understand the clause is that it’s the insurance industry’s version of arbitration. business insurance brokers brisbane Although similar, the Appraisal Clause is NOT an arbitration or mediation and the umpire is not an arbitrator, mediator, or judge. Insurance Appraisal, Mediation, and Arbitration are separate things.

In short; Arbitration requires attorneys and a legal process, where Insurance Appraisal does not require attorneys or a legal process. Arbitration is a dispute between two parties for any reason, where as, the Insurance Appraisal Clause is a for disputes between the “value,” of property only – bee it an automobile, plane, train, couch, house, commercial building, etc.

Most Policies Have the Appraisal Clause.

If you feel you’re at a dead end with your insurance company and want to resolve your claim you’ll need to check your policy for the Appraisal Clause. Most policies will have the provision listed under the “What to do after a loss,” section or the “Conditions” section of the policy. Below, you will find a sample of a typical Insurance Appraisal Clause included in most policies. Keep in mind that policies can be different in each state. Therefore, you should read your own policy to see if this clause exists. It will say something similar to the following ;

“APPRAISAL – If you and we fail to agree on the amount of loss, either one can demand that the amount of the loss be set by appraisal. If either makes a written demand for appraisal, each shall select a competent, independent appraiser. Each shall notify the other of the appraiser’s identity within 20 days of receipt of the written demand. The two appraisers shall then select a competent, impartial umpire. If the two appraisers are unable to agree upon an umpire within 15 days, you or we can ask a judge of a court of record in the state where the residence premises is located to select an umpire. The appraisers shall then set the amount of the loss. If the appraisers fail to agree within a reasonable time, they shall submit their differences to the umpire. Written agreement signed by any two of these three shall set the amount of the loss.”

OK, But How Does The Insurance Appraisal Clause Work?

The Appraisal Clause allows the policyholder (you) to hire an independent appraiser to determine the value of their damages. In turn, the insurance company will also hire their own independent appraiser. The two appraisers will then get together and select an umpire. The umpire is basically the arbitrator, or what you might call the judge. If a disagreement between the two appraisers arises, they can present their differences to the umpire who will make a ruling.