What are Appraisers & Umpires
If you’re facing a dispute with your insurance company, there are several options you can explore to work towards a better resolution and settlement.
What is an Insurance Appraiser?
An insurance appraiser is an unbiased professional who assesses the value of property or items for insurance purposes. They typically inspect the property or item, document the damage, and prepare estimates for repair or replacement costs. They evaluate the condition, quality, and values of insured items to determine appropriate coverage, claim settlements, or premiums. They provide a professional and neutral opinion. A public adjuster who has previously been hired on the same claim cannot also serve as the appraiser. This is to ensure impartiality and avoid conflicts of interest..
When is an Appraisal Appropriate?
Getting an insurance appraisal is a method of Alternative Dispute Resolution (ADR) that can be used when a policyholder and their insurance company disagree on the amount of loss in a property damage claim. Sometimes the insurance company and policyholder cannot come to an agreement on an insurance claim. Either the policyholder or the insurance company can start the process by using the “appraisal clause” in the insurance policy, which outlines how to resolve disagreements about the value of a claim.
How does the Appraisal Process Work?
After an appraisal clause is invoked in an insurance claim, the appraisers selected by the insured and the insurance company will review all documentation submitted by both parties, conduct their own investigations, estimate damages, and create a report. They will then attempt to agree on the amount of loss. If they cannot agree, they can hire an umpire or neutral appraiser to make the final decision.
What is an Insurance Umpire?
An insurance umpire is a non-biased third party, unrelated to either the insurance company or policyholder, who reviews the entire claim documentation compiled to date and makes an objective decision regarding the value of your property or the amount of property damage.
What is an Umpire Clause?
The appraisal language in a HO3 policy typically reads as follows: If you and and your insurance company fail to agree on the actual cash value, amount of loss, or cost of repair or replacement, either can make a written demand for appraisal. Each will then select a competent, independent, appraiser and notify the other of the appraiser’s identity within 20 days of receipt of the written demand. 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 district court of a judicial district where the loss occurred. The two appraisers will then set the amount of loss, stating separately the actual cash value and loss to each item.
When to Hire an Umpire?
An insurance claims umpire is typically hired when the insurance company and policyholder, after engaging appraisers, cannot agree on the amount of the loss or the scope of damages. The umpire acts as an impartial third party to resolve the dispute. Once the Appraisal clause/provision is invoked, the insured’s appraiser and the insurance carrier’s appraiser will estimate the damage and try to come to an agreement on the amount of loss. If they fail to agree, they then 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. Note, each party will pay its chosen appraiser while bearing the other expenses of the appraisal and umpire equally.
What’s Next After the Appraisal Award has been Agreed Upon?
Once an Award has been put in writing and signed by at least two of three participants, shared with the parties (the insured and insurer), and filed with the insurance company, the insurance company should immediately pay upon the award.
Give us a call if you need an appraiser or umpire to assist you with insurance claims in the Mid-Atlantic region, including Maryland, Delaware, Washington, DC, Northern Virginia, Central and Southern Pennsylvania including Philadelphia and parts of West Virginia. We specialize in handling Residential, Commercial, Farm Property/Farm Owners, Condominium, Large Loss, and Catastrophe Insurance Claims.