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Business Damage Claims – Appraisal Process


After you file a business damage claim with your insurance provider, the company sends an adjuster to inspect the damages and determine a claim settlement. What you may not realize as a business owner is that you do not have to accept the settlement amount that is offered. If you feel it is unfair and does not adequately cover your losses, you are allowed to file a dispute. A dispute must be made in accordance with the terms of your insurance policy, which is a contract. Some policies include an appraisal process clause that provides a method for resolving claim disagreements without having to take the matter to court.

Insurance Appraisal Process

When a dispute is filed the policy may require that both parties try to resolve it with an appraisal. An insurance claim appraisal is different than an appraisal for a home purchase. The process provides that both the insured and the insurance company hire independent appraisers to examine the damages. Another person, called an umpire, is also included in the process. Either party is allowed to invoke the appraisal clause as long as they do so within the time limits defined in the policy.

Both appraisers review the damage and record their findings. Then, they review the reports together and discuss the results. If they are not in agreement as to what should be done, the umpire makes the final decision. However, the settlement may still not be enough to cover your losses.

Disadvantages to the Appraisal Process

There may be some disadvantages for business owners in this process. An appraisal requires the business owner to hire an appraiser, which is typically not inexpensive. If the variance between what you believe you should be owed and what is being provided is less than $5,000, the process may not be worthwhile. However, in cases where there is a greater disparity, an appraisal is something to consider.

The process is may be required to be the first step taken to resolve a dispute. But it is important to note that the process is used only for disputes in the amount of a claim and not when there is a disagreement over the coverage of the policy.

Disputes with the Appraisal Results

If the appraisal process has been implemented and you do not agree with the results you may be able to take legal action. The law allows you to file a legal claim against the insurance company if they fail to provide adequate compensation, or unfairly deny or unreasonable delay the claims process. If you believe you have been treated unfairly by your insurance provider, contact us today. We have been fighting for the rights of home and business owners for decades and we will fight for you.


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