A Video Explaining the Use and Application of "Appraisal" in First Party Property Claims

Appraisal - A Means to Resolve Disputes About the Amount of Loss

Almost all homeowners policies contain an “appraisal” clause similar to that in the Standard Fire Insurance Policy.

The submission to the appraisers should be in writing, instructing that the parties do not want the appraisers to follow hard and fast, arbitrary, or fictitious rules in determining actual cash value, but to consider all evidence presented to them so that their award will serve to fully indemnify or compensate the insured for the actual loss he or she has sustained and at the same time not place him or her in a better position than he or she was in just before the fire.

By the appraisal provision, the insured and the company promise that if they cannot agree as to the amount of loss and claim they can submit their differences to a panel of three impartial arbitrators, called “appraisers.” The decision of the appraisers regarding the amount of loss is binding on both parties.

Appraisal should be used as a last resort when all efforts to reach an agreed amount of loss with the insured have failed. The appraisal provision is optional, and neither the insured nor the insurer is obligated to invoke that provision.

© 2021 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 53 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma;  Follow Mr. Zalma on Twitter at https://twitter.com/bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/ Read posts from Barry Zalma at https://parler.com/profile/Zalma/posts; and Read last two issues of ZIFL here.