The Appraisal Clause: Dispute a Low Offer Without Court | LIPA?

Your policy's appraisal clause resolves disputes over the amount of loss without a lawsuit: two appraisers, one umpire, binding result. Here's how to invoke it in NY.

How much does the appraisal process cost?

You pay your appraiser (public adjusters typically include this in their contingency fee), the insurer pays theirs, and the umpire's fee is split. Total cost is a small fraction of litigation — and the increased award almost always dwarfs the cost.

Can the insurance company refuse appraisal?

Rarely, and only on technical grounds — for example, if the dispute is purely about coverage rather than amount. When the disagreement is over value, appraisal is a contractual right under NY's standard fire policy, and courts compel it.

Who should I pick as my appraiser?

Someone competent and disinterested who knows construction pricing and claims — a licensed public adjuster is the standard choice. Your appraiser can't be your employee or have a financial stake beyond the appraisal itself, but a contingency-fee public adjuster acting as your appraiser is routine and accepted in NY.

Is the appraisal award really final?

Yes — on the amount of loss, the award is binding on both sides, and courts rarely disturb it. That's the point: it ends the pricing fight so the claim can be paid. Coverage disputes, if any, survive separately.

Should I appraise before or after hiring a public adjuster?

Hire the public adjuster first. Most claims settle in negotiation without ever reaching appraisal — a properly documented scope at real pricing resolves the dispute at the adjuster level. Appraisal is the leverage that makes carriers negotiate seriously.

Claim Process Guide

What Is the Appraisal Clause and How Do I Use It to Dispute a Low Offer?

The appraisal clause is a provision in nearly every NY property policy that resolves disputes over the amount of a loss without litigation. Each side hires an appraiser; the two appraisers agree on an umpire; any two of the three set a binding value. It typically takes 60–120 days, costs far less than a lawsuit, and you can invoke it with a simple written demand. Call 516-410-0164 for a free claim review.

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How Appraisal Works, Step by Step

You (or your public adjuster) send the insurer a written demand for appraisal. Each side appoints a competent, disinterested appraiser within the policy's window — usually 20 days. The two appraisers attempt to agree on the value of the loss. Where they disagree, a neutral umpire decides, and agreement by any two of the three sets the binding amount of loss.

Under New York's standard fire policy (Insurance Law § 3404) and Insurance Law § 3408, appraisal is a built-in right. The insurer pays its appraiser, you pay yours, and the umpire's fee is typically split.

Step 1: Written demand for appraisal sent to the insurer

Step 2: Each side appoints an appraiser (usually within 20 days)

Step 3: Appraisers select a neutral umpire

Step 4: Inspection and valuation of disputed items

Step 5: Any two signatures set the binding award

What Appraisal Can and Can't Fix

Appraisal decides one thing: how much the loss is worth. It's the right tool when the insurer agrees the damage is covered but their number is too low — underpriced Xactimate estimates, missing scope, over-depreciated items.

It does not decide coverage. If the insurer denied the claim entirely — saying the cause isn't covered — appraisal is the wrong tool; that dispute belongs in negotiation, a DFS complaint, or litigation. Often the smart sequence is: fight the coverage issue first, then appraise the amount.

Why Appraisal Usually Beats a Lawsuit

A property insurance lawsuit in New York can take 2–4 years and consume a third of the recovery in legal fees. Appraisal usually concludes in 60–120 days at a fraction of the cost, and the award is binding on the amount of loss.

A public adjuster can serve as your appraiser — we know the pricing, the scope, and the process. On average, settlements we handle come in 574% higher than the insurer's first offer, and appraisal is one of the tools that gets them there.

Key Takeaways

Appraisal resolves disputes over the AMOUNT of loss — not coverage
Each side picks an appraiser; a neutral umpire breaks deadlocks
The result is binding on the value of the loss
Typically 60–120 days — much faster than litigation
You invoke it with a written demand; no attorney required

Licensed in New York

Kevin Godfrey, License #PA-1156995 · 22+ years experience · Fees 6–12% (NY cap 12.5%)

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