Appraisal Under Policy

An appraisal clause is a clause in an insurance policy that gives the insurer and insured the right to demand an appraisal on any damaged property. It gives both the insurer and insured a means of settling disputes over the value of lost or damaged property. For an appraisal under policy, a professional loss adjuster can work directly for an insurance company or third-party and conduct the appraisal on their behalf.

The appraisal under policy clause is useless if the insured has no coverage under their policy or if an insurer denies coverage under the policy. Until coverage is confirmed, either party should not make a demand for appraisal. However, if the insurer denies coverage for only part of a claim, admits coverage, or requests appraisal itself, then the appraisal process can begin after there has been a dispute regarding the loss valuation. The insurance company always has the right to accept or deny coverage even after the appraisal process.
What Do Our Loss Adjusters Do?

Most property coverage forms have appraisal provisions within the coverage of the policy. When BPO is hired on an appraisal, our highly experienced professional loss adjuster will communicate with the client, review any documentation from the original claim process, communicate with the other appraiser, work with the other appraiser to agree on an umpire, and perform an investigation of the loss.

The appraisal process includes estimating or setting a value on an insured loss. The procedure is usually informal and is done without a presiding officer, compulsory process, or any other signs of a court proceeding. The only parties involved are the insured’s appraiser, the insurer’s appraiser, and an Umpire chosen by the two appraisers. The appraisal process began as a means for providing policyholders with an inexpensive and comparatively quick determination of the value of an insurance claim when there is a dispute. Insurers can and often do seek appraisals when coverage of a loss is recognized but the value of the loss is disputed.

Why Insurance Companies Need Loss Adjusters for Appraisals under Policy

Some of the most successful appraisals under policy are conducted by neutral third-party professional loss adjusters. Since the dispute is over how much a loss is worth and not whether or not a loss is covered by the policy, the insured has no need to prove the loss is covered as that is left up to the insurance company and the courts.

At BPO Technical Services, while our loss adjuster staff handles first party claims, we work totally independent when it comes to appraisal services. When an appraisal under the policy is warranted, the appraiser works as a neutral and unbiased party and does not take direction from anyone. The appraiser’s opinion, while it is based on the contract of insurance, is a totally unbiased opinion of loss and damage without being influenced by the insured or insurance company. The importance of utilizing a loss adjuster to complete an appraisal gives stability to the process and allows the management of the appraisal to flow within the policy coverage. Many times appraisals involve maintenance type repairs as well as depreciation. The loss adjuster when acting as an appraiser can be invaluable when managing the appraisal process within the designed coverage of the policy.