Appraisal – Alternate Resolution

Alternate Dispute Resolution

When you and your property insurer disagree on the amount of damage after sincere attempt, your policy provides a method of resolving the claim without resorting to litigation (a lawsuit against the company).  This is the appraisal process.

Litigation can take 3 or 4 years, during which you may not have the funds to replace or repair your damaged property. Present laws in New York and Connecticut make it very close to impossible to receive an award in court in excess of the actual repair or replacement damage.  There is no provision for bad faith claims or to recover your attorney fees. An attorney will normally charge one-third of the total you ultimately collect, and then there are other expenses, such as expert witness fees, transcripts, court costs, etc. Ultimately it might cost you half of your legitimate claim even if you are completely successful with your lawsuit.

Recent changes to the law in New York have broadened the reach of the appraisal process.  See New Insurance Bill for more information.

A typical appraisal clause reads as follows:

“Appraisal. If you and we fail to agree on the amount of the loss, either can demand that the amount of the loss be set by appraisal. If either makes a written demand for appraisal, each shall 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 shall then select a competent, impartial umpire. If the two appraisers are unable to agree upon an umpire within 15 days, you or we can ask a judge of a court of record in the state of the Described Location to select an umpire.

The appraisers shall then set the amount of loss. If the appraisers submit a written report of agreement to us, the amount agreed upon shall be the amount of the loss. If the appraisers fail to agree within a reasonable time, they shall submit their differences to the umpire. Written agreement signed by any two of these three shall set the amount of the loss. Each appraiser shall be paid by the party selecting that appraiser. Other expenses of the appraisal and the compensation of the umpire shall be paid equally by you and us.”

Appraiser Qualifications

The policy does not differentiate as to who may serve as an appraiser. The law requires that the appraiser be “competent” and “independent”. Many policies require that an appraiser also be disinterested. Competent means exactly that. The person chosen must have the ability and experience to evaluate the particular claim in question. Independent means to be free from the influence, guidance, or control of the parties. Disinterested means that the person must not have a financial or personal interest in the outcome of the matter.

Choosing your appraiser is an important decision. There is more to evaluating a claim and negotiating it than being able to price the damage. We specialize in business and homeowner appraisals and have a good success ratio. Often it makes sense to engage us as an appraiser rather than as an adjuster.  Especially after attempting to settle the claim without success. The fee for appraisal services is hourly rather than a percentage of the claim.

Please call to discuss the possibility of handling your case as an appraiser. Appraisal may be the answer to ultimately collecting a fair claim award. (914) 528-5374