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In a perfect world the appraisers would both be impartial. But in reality, the insured's appraiser will generally take the insured's point of view and the insurer's appraiser will take the insurer's point of view. Though they may try to come to agreement, an appraisal more often than not goes to an umpire. It is important that 1. The umpire be impartial, and 2. The umpire be an expert in the field in which the appraisal is centered. For example, an accountant is the best choice for a business interruption appraisal and a construction expert is the best choice for an appraisal involving a building.

The carrier has no right to accept or reject the insured's appraiser. The insured is paying for the appraiser and has the absolute right to name who that person will be. It can be their cousin Fred who works at the Seven Eleven if they want it to be. After all, he knows the price of some contents that he sells off the shelf. My advice to you -- 1. Work up your analysis. 2. Let the insurer know what your opinion is so they will not be surprised and can make any additional payments voluntarily if you think they are too low. 3. Go into the appraisal and present your position and listen to the other side. 4. KNOW THE DIFFERENCE BETWEEN AN APPRAISAL AND AN ARBITRATION. 5. Remember that two people have to agree on the value.  This is not a negotiation as much as a determination of actual value, so splitting the difference is not appropriate.  If the carrier wanted to split the difference, they could have negotiated the claim without the assistance of an appraiser.  6. Make sure you can back up your figures so the umpire will be more likely to side with you.

Steve has just given you the correct information. Stick with what he has told you and you can't go wrong.

Touche, Sir Cook! I think you could use the same information Tom and I gave above. Of course, instead of informing the insurance carrier of what your valuation is, you would want to let the insured know how you see the valuation so they can adjust their expectations if you believe they are asking for too much.

So, now I have PAs wanting to use my advice? What's next.  In reality, I doubt my post has anything you didn't already know.

This impartial thing has always been ignored to my knowledge in Texas. The same carriers always use the same contractors who do almost nothing else but appraisals and the PA's do the same with ex insurance contractors who have changed sides. It,s presentation to the old retired judges in good ole Texas.

Posted By Ray Hall on 24 Dec 2009 06:56 PM

This impartial thing has always been ignored on the most appraisals to my knowledge in Texas. The same carriers always use the same contractors who do almost nothing else but appraisals and the PA's do the same with ex insurance contractors who have changed sides. It,s presentation to the old retired judges in good ole Texas.

by the way Bill, go through the process and if its not "impartial" go into court and try to get the award set aside like NY and some other states do. But keep very good paper records and record all meetings. Make sure no contact is made with umpire, unless both of you are their. Do not crunch estimates until both appraisers agree in writing "the scope of damage" with out side doc,s if needed. The ACV and RC(if applicable) should be agreed as RC is not in most appraisal clauses.

I guess my whole issue is that the PA firm isn't even going outside of their own company for their appointed appraiser.  The appraiser appointed is employed by the PA Firm.   I would be as equally concerned if the insurer reassigned the claim to one of their other adjusters and called him/her their appraiser. 

While I am aware that there are always "relationships" within the industry, former employers etc ..... you would think that there would have to be outside the employment and at least one arm's length away from the current participants. 

It really depends on the state. Many states will not get involved in the apraisal process. Some states equate appraisal to arbitration. Some like NY will not allow a PA to represent the policyholder.Ther best treatise on this subject was written by  Jonathan J. Wilkofsky the legal council for the NY Pubic adjusters Assoc.

I dont think Florida allows a PA from the same firm to represent the policyholder. contact me and I will try to get you the law. Medulus is correct, but some awards have been set aside as one side or the other "was not impartial". A carrier would never appoint an appraiser that did not have some simulance of "impartiality" .

The appraiser for either side should bring up impartiality of either side as soon as he/she is appointed and not select an umpire UNTIL this is clearned up and then procede. So I kinda disagree with neither side haveing a say in the appointment of an appraiser. I sent an affidavit form to the appraiser to sign about this question, which may impeach the appraiser in a contasted award, action to set aside for cause.

Steve good cases  about impartial. I did not say the appraiser for the other side would sign the affidavit. I will just use this in my presentation to the "neutral umpire". Each state has their own rules on appraisal and lots of cases have been overturned for any number of reasons and many more have been upheld for the same reasons. It seems any professional or any adjuster who works these disputes would fall into this description can not use 2 or 3 employees in a dual role on the same dispute. Attorneys, CPA, Engineers, Adjusters etc.