Navigating a property damage claim with your insurance company can be a daunting task, especially when faced with an unfair settlement offer. Contrary to common belief, policyholders are not bound to accept the initial settlement without question or negotiation. The Appraisal Process, also known as the Appraisal Clause or Statutory Appraisal, provides a valuable remedy outlined in insurance policies.
Key Information about the Appraisal Process:
Inclusion in Policies:
Many residential and commercial property insurance policies include an Appraisal Clause, typically found under the “Conditions” section.
Alternative to Litigation:
The Appraisal Process is similar to mediation or arbitration, offering an efficient and effective alternative to lengthy and costly litigation.
When to Consider Appraisal:
Policyholders may invoke the Appraisal Clause if faced with an unfair settlement or if the insurance company is unwilling to negotiate.
Upon invoking the Appraisal Clause, each party selects its own Appraiser.
A neutral umpire is chosen by the two Appraisers, or the court appoints one if an agreement cannot be reached.
The Appraisers attempt to agree on a settlement amount, submitting areas of disagreement to the umpire if needed.
Upon agreement by two-thirds of the panel, an Appraisal Award is signed, and the insurance company is obligated to make the payment within the stipulated time.
Benefits of the Appraisal Process:
The Appraisal panel consists of individuals and experts familiar with property damage claims, providing specialized knowledge compared to a general jury in litigation.
Cost-Effective and Timely:
Appraisal costs are reasonable, and cases are resolved more swiftly than through the litigation process.
It’s crucial to note that policyholders and insurance companies alike can invoke the Appraisal Process to settle disputed claims. In cases where the insurance company initiates an Appraisal Request, seeking the expertise of an Appraiser is essential to ensure a fair evaluation of your claim. The Appraisal Process stands as a powerful tool for policyholders, offering a structured and efficient means of dispute resolution.
If you have any questions on the Appraisal Process, contact Hooten and Associates – We Give a Hoot!