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Insurance Law Appraisal



When you as the policyholder have a disagreement with an insurance company regarding the value of your claim, appraisal is an option to resolve the dispute without litigation. Appraisal comes with its own risks and challenges as explained below. An Appraisal clause is included in most insurance policies and generally reads as follows:

Sample appraisal clause:

If you and we fail to agree on the amount of loss, either may demand an appraisal of the loss. In this event, each party will choose a competent and impartial appraiser within 20 days after receiving a written request from the other. The two appraisers will choose an umpire. If they cannot agree upon an umpire within 15 days, you or we may request that the choice be made by a judge of a court of record in the state where the “residence premises” is located. The appraisers will separately set the amount of loss. If the appraisers submit a written report of an agreement to us, the amount agreed upon will be the amount of loss. If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will set the amount of loss.


Each party will:



Pay its own appraiser


Bear the other expenses of the appraisal and umpire equally

The first thing to do should you wish to consider whether appraisal is right for your claim dispute is to have an insurance professional interpret the appraisal clause referenced in your policy. Different insurance policies contain different variations of appraisal clauses that may appear to be minor but may have great implications on your potential recovery. Pay close attention to words such as “must” or “shall” as these words have legal meanings which may mean that appraisal is a requirement, rather than an optional way to resolve your claim. The appraisal process severely limits your ability to dispute the appraisal result, or “award”, and can preclude you from seeking additional damages such as bad faith and attorney’s fees. It is pivotal to have an attorney, or other trusted insurance professional, review this clause for its underlying implications and meanings. Reputable attorneys will do this type of evaluation at no cost to you during an introductory consultation.

At Kennedy Insurance Law, we have a comprehensive understanding of the appraisal process, having worked both in-house as legal counsel for a large commercial insurer and as policyholder counsel. We have recent experience with the positives and negative aspects of the appraisal process and invite you to contact us with your questions or for a free consultation regarding your specific insurance claim.