John Audlee

An insurance appraisal is a dispute resolution process outlined in most property insurance policies. When the policyholder and the insurer disagree on the value of a loss, either party can invoke the appraisal clause. Each side appoints an independent appraiser, and the two appraisers select a neutral umpire. A decision agreed upon by any two of the three is binding.

A written demand initiates the process. Each party must select their appraiser (typically within 20 days). The two appraisers then select a neutral umpire (typically within 15 days). Each appraiser independently evaluates the loss, and they attempt to agree. If they cannot, the differences are submitted to the umpire, whose decision — agreed to by any two of the three — is binding.

An appraiser is selected by one party (policyholder or insurer) to independently evaluate the amount of loss. An umpire is a neutral third party selected by both appraisers (or appointed by a court) to resolve disagreements between the two appraisers. The umpire's role is to be completely impartial.

Yes. When properly executed, an appraisal award is generally binding on both parties as to the amount of loss. The appraisal process addresses only the value of the loss — it does not determine coverage questions.

Each party (insured and insurer) pays for their own appraiser. The costs of the umpire and other appraisal expenses are generally shared equally between both parties.

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