What Is An Insurance Appraisal?
Navigating a property claim can often be an extremely confusing process. For a homeowner who has never had to file a claim before, understanding this process can quickly become frustrating. There is a lot of industry language and shorthand phrases used to discuss the damage to your property, that if not properly explained, can leave a homeowner uninformed and searching for help. It's important to understand your claim, however, so that you can ensure that you are receiving an appropriate response from your insurance, as well as any contractors you may hire. As a general contractor, 3:16 Roofing & Construction strives to make this process as easy to navigate as possible.
The Oxford dictionary defines an appraisal as "an expert estimate of the value of something." When you file a claim for damaged property caused by a storm, your insurance carrier will likely send an adjuster to inspect the property. The adjuster will write an estimate for the cost to repair the damaged property. This estimate is often referred to as a scope-of-work. From there, you can choose how you would like to repair the damaged property, whether that means doing the repairs yourself or hiring a contractor.
If your insurance adjuster failed to include a section of damaged property on their estimate, remedying this can be as simple as sending them a photo and asking that they add it. This is referred to as a supplement, and is commonly done by the contractor on behalf of the homeowner. But what happens if your preferred contractor's estimate is higher than the amount your insurance has agreed to pay? (Don't worry, you don't have to pull out your checkbook quite yet!)
"The appraisal process is a homeowner's right to an unbiased third-party opinion regarding the damage to their property."
The appraisal process is a homeowner's right to an unbiased third-party opinion regarding the damage to their property. Similar to the appraisal one would expect to receive when purchasing or selling a home, an appraisal for an insurance claim helps all involved parties determine the appropriate repair methods and fair cost of replacement for the damaged property.
While your homeowners insurance carrier is on your side to help you mitigate and recover any losses to your property that might have been caused by a storm, they are not entirely unbiased. Every insurance carrier has standard operating procedures that determine what they can and cannot provide coverage for. Depending on your circumstance, you may find yourself unable to properly repair your home to its pre-storm condition because your insurance carrier will not agree to the repair methods or cost of repair you feel are appropriate.
For example, let's say you received a beautiful outdoor vase as a gift from a family member. During a recent storm, hail hit the vase and shattered it. Under your homeowners policy, your loss may likely be covered. In this instance, however, your insurance adjuster says he found a similar piece of pottery available for purchase online for $50. You know that this vase is much more valuable, and will cost approximately $400 to replace.
In this situation, we have a difference in the appraised cost of repair. You say the vase costs one amount, while your insurance carrier says it is worth less. In instances such as these where there is a disagreement in the cost of repairs, a homeowner has the right to invoke appraisal. Invoking appraisal simply means that the homeowner notifies the carrier of their desire to enter the appraisal process. Assuming the insurance adjuster is unwilling to accept your estimated cost of repair, invoking appraisal may be your best option to receive fair coverage for your damaged property.
So, what exactly is the appraisal process?
According to Miller Public Adjusters, "Appraisal is a binding contractual process available to settle valuation disputes between policyholders and their insurance companies." To enter appraisal, either the insured or the carrier must submit in writing their desire to act upon the policy's appraisal clause. Many policies state that a carrier has twenty days to respond to this notice.
An insurance appraiser is a licensed, educated and disinterested professional who will evaluate the claim to determine the cost of the loss. Both the policyholder and the insurance carrier must choose their own appraiser. Together, these two professionals will work together to appropriately settle the claim. If they cannot come to an agreement on the repair methods or cost of repair, then an umpire will be chosen. This umpire is a licensed appraiser who is given final authority to settle the claim.
Once a valuation of loss has been reached, either by agreement between the two appraisers, or by an umpire, the verdict is final. An insurance carrier cannot deny the findings or valuation of an appraisal and must provide coverage accordingly. The appraisal process has several benefits to you. Primarily, it removes the responsibility of valuing the loss from the carrier and grants it to the appraiser. Since insurance companies are for-profit businesses, it is often in their best interest to pay less money than one might find appropriate on a particular claim. Since an appraiser's valuation of loss is final, and the approach is designed to be unbiased, many homeowners greatly benefit from this process and are able to receive the fair coverage value for their loss.
It's important to note that appraisers do not have the ability to negotiate issues involving policy coverage, provisions, or deductibles. If you believe you are not receiving appropriate coverage based on your specific policy, there are other options available to you, such as hiring a public adjuster.
Before contacting an appraiser, it's best to have a qualified company inspect the damages to your property to determine the recommended repair methods. The more knowledge you have about your loss, the more equipped you will be to negotiate fair coverage. Contact 3:16 Roofing & Construction today to schedule a complimentary, no-obligation inspection!
3:16 Roofing & Construction is a licensed contractor located in Keller, TX. We service the entire Dallas-Fort Worth metroplex. Our company offers the best warranties in the industry, including a 5-year workmanship warranty. We take pride in our work knowing it's done with honesty and integrity. To us, it's more than just a roof. It's home, it's family.