Appraisal Services

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Appraisal as an Alternative Dispute Resolution in Insurance Claims: A Fair and Efficient Solution

In the realm of insurance claims, disputes can occasionally arise between policyholders and insurance companies over the valuation of damages or the extent of coverage. These disagreements can be time-consuming, costly, and often lead to unnecessary legal battles. To address such situations, many insurance policies include a provision for appraisal as an alternative dispute resolution method. Appraisal offers a fair, efficient, and impartial way to resolve conflicts, ensuring a prompt resolution to insurance claim disputes.  Prime Adjustments is impartial and will review and scope the damages attributed to your loss.

Understanding the Appraisal Process:

Appraisal is a structured process in which both the policyholder and the insurance company appoint an independent appraiser to assess the value of the damages or the disputed aspects of the claim. The two appraisers work collaboratively to reach a mutually agreed-upon value. If they are unable to reach a consensus, they may appoint an umpire as a neutral third party to make the final decision.

Key Benefits of Appraisal as an Alternative Dispute Resolution:

  1. Speedy Resolution: Appraisal offers a faster resolution to disputes compared to traditional litigation, which can be lengthy and time-consuming.
  2. Cost-Effective: Engaging in appraisal typically incurs lower costs than protracted legal proceedings, saving both parties time and money.
  3. Expert Evaluation: Appraisers are usually experts in their respective fields, ensuring that the valuation is accurate and based on sound professional judgment.
  4. Impartiality: The use of independent appraisers and, if needed, an umpire, ensures an unbiased evaluation of the claim, eliminating potential conflicts of interest.
  5. Preserving Relationships: Appraisal allows for a more amicable resolution, helping maintain a positive relationship between the policyholder and the insurance company.

The Appraisal Process in Insurance Claims:

  1. Triggering the Appraisal Clause: When a disagreement arises, either the policyholder or the insurance company can invoke the appraisal clause in the insurance policy.
  2. Appointment of Appraisers: Both parties select their appraisers, who are independent and have no prior connection to the dispute.
  3. Assessment and Negotiation: The appraisers evaluate the damages or disputed aspects of the claim independently. They then meet to discuss their findings and attempt to reach an agreed-upon value.
  4. Involvement of an Umpire (if needed): If the appraisers cannot reach a consensus, they may appoint an umpire, whose decision will be binding.
  5. Final Resolution: Once an agreement is reached between the appraisers or the umpire’s decision is made, the final valuation becomes binding and helps resolve the dispute.

When to Consider Appraisal:

Appraisal is a viable option when disputes involve property damages, loss valuations, or coverage disputes. It is essential for both policyholders and insurance companies to be aware of this option and consider it as a means of resolving disagreements swiftly and fairly.


In cases where policyholders and insurance companies find themselves at odds over the expenses tied to repairing or replacing damaged property, the frustration can be palpable. This scenario is particularly disheartening for policyholders who often feel cornered into accepting the insurance company’s offered sum. Regrettably, insurance companies do not consistently inform policyholders of their entitlement to engage in various dispute resolution avenues, a situation that is becoming increasingly prevalent.

As a consequence, many policyholders remain unaware of their right to contest an insurance settlement figure, and the process of initiating a property insurance claim dispute often eludes them.

One effective recourse for policyholders seeking to challenge their insurance provider’s proposed settlement is to trigger the appraisal clause embedded within their insurance policy. When executed correctly, the appraisal process serves as a potent alternative for resolving disputes. However, it’s essential to note that not all insurance policies incorporate an appraisal clause.

The appraisal clause, when present, typically features language similar to the following, serving as a comprehensive overview of the Appraisal process:

Appraisal Clause: 

“In the event that agreement cannot be reached on the extent of the loss, either party may opt to invoke the Appraisal process. Upon written request for Appraisal, both parties shall select an independent, qualified appraiser. Within 20 days of receiving the written request, each party shall disclose the chosen appraiser’s identity to the other. The two appointed appraisers will then jointly select a neutral Umpire with suitable expertise. Should the appraisers fail to agree on an Umpire within 15 days, either party has the option to request a judge from a court of record in the state where the property is located to appoint an Umpire.

The Appraisers will proceed to determine the extent of the loss. Should the Appraisers be unable to reach a consensus within a reasonable timeframe, they will submit their differences to the appointed Umpire. A written agreement endorsed by any two of the three individuals shall dictate the final loss amount.”

Incorporating the appraisal clause within your insurance policy can pave the way for a constructive and impartial means of settling disagreements between policyholders and insurance companies. This process ensures fairness and provides a viable solution when common ground proves elusive.

Contact us today to retain us for your appraiser service needs.


Appraisal vs Lawsuit

Quick – ExpedientSlower – protracted
Relatively less costlyGenerally more costly
May be less adversarialMore adversarial
No appellate potentialAppeal is possible
Must pay fees/costsMay recover fees/costs
No firm procedureStrict procedures

Appraisal FAQ's

In cases where you and your insurance provider find yourselves at an impasse regarding the valuation of your claim or continue to disagree about the extent of property damage and the associated repair costs, your insurance policy may offer a solution known as the appraisal clause. While not universally applicable, the appraisal clause presents an alternative path for resolving disputes, potentially expediting the resolution of your claim.

So, how exactly does the appraisal process function? It commences with your selection of an impartial appraiser to advocate on your behalf, paralleled by your insurance company’s appointment of a representative appraiser. These two appraisers collaboratively designate a neutral umpire. Individually, both appraisers assess the damages pertaining to your claim. Subsequently, they convene to evaluate the claim with the intent of finding common ground.

Should discrepancies persist and the appraisers fail to achieve unanimity on specific matters, the neutral umpire steps in to issue a final, binding verdict. This decisive pronouncement concludes the appraisal process, settling contentious points and establishing a definitive resolution.

As for the financial aspect, each party covers the remuneration for their respective appraiser, while the fee for the umpire is evenly divided between both sides. By engaging the appraisal clause, you engage a structured process that seeks to reconcile differences efficiently, facilitating a potentially swifter resolution for your claim.

If you choose to hire us as the appraiser, we first ask to review all documents related to your insurance claim to get up to speed on your file.   If we choose to take on your file we will then be listed as your appraiser and will let all parties know we are retained on your appraisal.

Every property insurance claim is different.  If the amount in dispute is minimal then it may not make sense to go to appraisal and incur additional costs.  Our appraisers can review your file to determine if appraisal is the best course of action.

Not all property insurance claims are eligible for the appraisal process. The availability of the appraisal process and the specific circumstances under which it can be invoked vary depending on the terms and conditions outlined in your insurance policy. Here are some key points to consider:

  1. Appraisal Clause in the Policy: Whether or not an appraisal is an option depends on whether your insurance policy includes an appraisal clause. Some policies may have this clause explicitly stated, while others may not.
  2. Disputed Amounts: The appraisal process is typically used to resolve disputes related to the value of the claim, not disputes over coverage or policy interpretation. If there is a genuine disagreement about the monetary value of the damages, the appraisal process might be applicable.
  3. Limited to Specific Situations: Appraisal is generally reserved for situations where there is a dispute over the amount of loss, such as property damage assessments. It may not be applicable for disputes over policy coverage.

To determine if your property insurance claim is eligible for the appraisal process, contact Prime Adjustments today for a review of your insurance claim.   Keep in mind that while appraisal can be a useful tool for resolving disputes, it may not be applicable in every situation.

This varies based on the intricacy of the file being appraised. As the policyholder, you are responsible for covering your appraiser’s fees and contributing half of the umpire’s expenses, if the involvement of an umpire becomes necessary. Your appraiser’s fee structure is typically hourly with associated expenses or a percentage basis, provided it aligns with the regulations of the state where the loss transpired. Generally, the umpire operates on an hourly rate along with expenses. On the insurance company’s end, the expenses encompass its own appraiser’s fees and the remaining half of the umpire’s costs.  Contact Prime Adjustments today for a quote on our appraisal fee’s.

Prime adjustments can work most all states nationwide.  If we cannot help you with your appraisal, we will refer you to someone competent that can in your area.


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