A Homeowner’s Guide to the Appraisal Process
Filing a claim can be intimidating, and at times, it may feel like insurance companies have all the
power when determining how much should be paid on a claim. However, as a homeowner, it’s
important to understand that you have options when an insurance company underpays or chooses
to cover only repairs instead of replacing your property.
Most insurance policies include an appraisal provision as an alternative dispute resolution. This
process helps expedite the determination of how much you are owed for your damaged property.
The appraisal process typically follows these steps:
1. Verify your policys appraisal provision – Ensure that your policy allows for a
unilateral appraisal provision, meaning either party can elect to participate.
2. Select appraisers – Each party (you and the insurance company) selects an independent
appraiser.
3. Appraisers evaluate the damage – The appraisers inspect the damaged property, review
documents and estimates, and attempt to reach an agreement on the value of the damage.
4. Engage an umpire if necessary – If the appraisers cannot agree, they will select an
umpire, a neutral third party. The umpire will review all documents and estimates and
ultimately determine the final amount of damages.
If your claim has been denied, you cannot request to participate in the appraisal process.
While there are advantages to the appraisal process, such as its expedited nature, it also has
drawbacks. One key disadvantage is that appraisal awards are binding, meaning that if you
disagree with the appraisers’ estimated amount of damages, there is little recourse available. In
contrast, litigation may take longer, but as a homeowner, you have more control over any
settlement that is reached.
Chrystina Albertini, ESQ.
