Insurance Appraisals: Resolving Property Damage Disputes Outside the Court System
Disputes can arise between an insured party and an insurance company regarding the extent and cost of damage to insured property. When disagreements escalate, they may lead to arbitration or litigation — both of which can be costly, time-consuming, and disruptive. To avoid these outcomes, most insurance policies include an appraisal clause that can be invoked by either the insured or the insurer.
The primary goal of the insurance appraisal process is to reach an agreement on the extent and value of the loss without involving the court system. Appraisal provides a structured, impartial mechanism for resolving disputes while maintaining efficiency and reducing legal expenses for all parties involved.
Once the appraisal clause is enacted, each party selects an appraiser. Appraisers are qualified professionals who provide expert opinions and act as representatives for the parties that appoint them. Their role is to evaluate the damage objectively, assess the scope of loss, and work toward a fair resolution based on documented findings and industry standards.
After both appraisers are selected, an on-site inspection of the property is conducted. During this inspection, the appraisers review the damaged areas, discuss the extent of the loss, and evaluate the condition of affected building components. If the appraisers reach agreement on the extent of damage during the on-site meeting, they then identify and document the itemized costs associated with the repairs or replacement.
Once the scope and cost of damages are agreed upon, both appraisers document their findings in writing. The appraisal process is concluded when both appraisers sign the appraisal award, at which point the claim is considered resolved and closed.
If the appraisers are unable to reach agreement, the appraisal process advances to the next stage — the involvement of an umpire. The umpire serves as a neutral third party who reviews the findings of both appraisers and assists in resolving the dispute. The role of the umpire and the procedures that follow are addressed separately in the appraisal framework.
EES has experience representing both insured parties and insurance carriers throughout the appraisal process. This balanced perspective allows EES to provide efficient, cost-effective, and timely resolutions to appraisal disputes while maintaining objectivity and professionalism.
Insurance appraisals offer a practical alternative to litigation by focusing on technical evaluation rather than legal arguments. When conducted properly, the appraisal process promotes clarity, fairness, and resolution while minimizing unnecessary delays and expenses.