A Video Explaining how to Deal With a Demand for Insurance Appraisal

Read the full article at https://www.linkedin.com/pulse/insurance-appraisal-barry-zalma-esq-cfe and see the full video at https://youtu.be/sumAyPMaNT4 and at https://rumble.com/c/c-262921.and at https://zalma.com/blog plus more than 3850 posts. 

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

This appraisal provision is, in many states, considered an arbitration proceeding. In California, an appraisal complies with the requirements of California Code of Civil Procedure section 1280 et seq. It is easily implemented and works promptly.

In some states, as becomes clear below, appraisal is not considered to be an arbitration, but is still enforceable as a contractual provision.

However, the use of such appraisal will be rendered meaningless if the appraisers are bound to the some of the definitions of actual cash value issued by various courts and regulators. They are not entitled to resolve coverage issues but are compelled to reach their conclusions in accordance with the law of the state where the appraisal will take place.

The appraisers are limited, however, only to decide the amount of loss and the value of the property in question. (Jefferson Insurance Company of New York v. Superior Court, 3 Cal. 3d 398, 90 Cal. Rptr. 608 (1970).) The appraisers cannot make decisions outside the limited scope of the policy language. They cannot find that the insured did not own the property, that the insured had no interest in it, that the insured was not entitled to recovery under policy exclusions, that the insured presented a fraudulent claim, or that the loss exceeds the policy limits.
ZALMA OPINION

Appraisal is an important right available to insurers and their insureds to resolve, without a great deal of expense, lawyer fees, and time to resolve the usual dispute between insurers and insured about the amount of loss.