Appraisal and Umpire
Appraisal is in your policy, not in Pennsylvania law
Appraisal is a way to settle a disagreement about how much a loss comes to, without going to court. The first thing to understand about it is where it comes from: appraisal is a provision inside your insurance policy. It is not a right created by Pennsylvania statute or regulation. If your policy contains an appraisal provision, that provision governs how appraisal works on your claim — who can demand it, when, how the appraisers and umpire are chosen, who bears which costs, and what effect the result has. If your policy does not contain one, appraisal is not available.
This distinction is not academic. It means there is no general Pennsylvania answer to “how long do I have to demand appraisal” or “who pays the umpire” — those answers are in your contract, and appraisal provisions differ. Anywhere this page describes a mechanic, treat it as the common shape of these provisions and then go read yours.
The second thing to understand is the limit on what appraisal can do, which is covered next, and which is the reason appraisal is sometimes the right move and sometimes not available at all.
Appraisal decides the amount. It does not decide coverage.
This is the single most important thing on this page. Appraisal exists for the case where both sides accept that the policy responds to the loss and disagree about what the loss comes to. It is not a route for challenging a denial.
Pennsylvania courts have drawn that line explicitly. Where an insurer denies a claim by relying on an exclusion in the policy, the disagreement is a coverage dispute, and a coverage dispute is not the proper subject of appraisal. Where the parties instead disagree about the extent of the damage — or about whether a covered peril caused particular damage — that has been treated as a disagreement about the amount of loss, and therefore as something appraisal can properly reach.
That second half is a genuinely fine distinction and it is where these disputes most often live. “Some of this roof damage is from the storm and some is from age” is usually an amount-of-loss question. “None of this is covered because of this exclusion” is a coverage question. Which characterisation fits a particular file depends on the policy language and the evidence, and it is worth getting right before invoking anything.
Typically an amount-of-loss dispute
- Both sides agree the policy responds, but the estimates are far apart.
- The disagreement is about the extent of damage — how much of a roof, how much of a floor, how far the water travelled.
- The disagreement is about the method or quality of repair the loss requires.
- The insurer has issued a payment and the file is otherwise moving; the gap is arithmetic and scope, not entitlement.
Typically outside appraisal’s reach
- The insurer denied the claim by relying on a policy exclusion — that is a coverage dispute.
- The dispute is whether the policy was in force, or whether the claimed cause of loss is a covered peril at all.
- The dispute is about late notice, misrepresentation, or a condition of the policy rather than the size of the loss.
- You want a determination that the insurer acted in bad faith — that is a legal claim, not an appraisal question.
These are general characterisations of how these disputes are usually classified, not a determination about any particular claim. Which side of the line a specific disagreement falls on depends on the policy language and the documented facts.
How the process is usually structured
Appraisal provisions commonly follow a three-part shape. Every element below is a feature of the typical provision, and each one can differ in your policy — this is a map for reading your own provision, not a description of your rights.
A demand is made
One party invokes the provision in writing. Which parties may demand it, and any conditions or time limits on doing so, come from the policy. Some provisions tie the demand to events in the claim rather than to a fixed number of days.
Each side names a competent appraiser
The two appraisers each assess the loss and attempt to agree on its amount. If they agree, that generally concludes it. An appraiser is not a neutral — each is selected by one party — which is why the appraiser’s ability to document and support a position matters.
An umpire resolves what the appraisers cannot
Where the two appraisers cannot agree, they select an umpire, and an award agreed to by two of the three sets the amount of loss. How the umpire is selected — and what happens if the appraisers cannot agree on one — is set by the provision.
Two further points that are governed by the policy rather than by any general rule: cost allocation (many provisions have each side pay its own appraiser and split the umpire and other appraisal expenses, but confirm yours) and the effect of the award (many make it binding as to the amount of loss while preserving the insurer’s other defences). Whether completing appraisal is a precondition to filing suit on the policy is a legal question — Pennsylvania courts have enforced these provisions as contractual requirements, and failing to comply has been held to bar suit under a policy that required it. That is a matter to raise with an attorney.
What a public adjuster does here
Appraisal is an evidentiary exercise. The amount of loss is established by documentation — measurements, photographs, scope, material specifications, expert and contractor input — assembled into something an appraiser or umpire can evaluate. That documentation work is public adjusting work, and it is the same work whether or not appraisal is ultimately invoked.
ACI Adjustment Group’s licensed Pennsylvania public adjusters prepare and present the amount of loss on behalf of policyholders, and can serve as the policyholder’s appraiser where the policy’s provision applies and the engagement calls for it. We represent policyholders only.
We will also tell you when appraisal is the wrong instrument. If the real dispute is about coverage, appraisal generally cannot reach it, and pursuing it costs time that would be better spent on the actual disagreement. If the dispute is legal, you need a lawyer, and we will say so.
A separate matter: how the claim was handled
Appraisal addresses the amount of the loss. It says nothing about whether the insurer handled the claim properly. That is governed separately, by Pennsylvania’s unfair claims settlement practices regulations at 31 Pa. Code Chapter 146 — which set minimum standards for acknowledging a claim (§ 146.5), completing the investigation and explaining delay (§ 146.6), and advising a first-party claimant of acceptance or denial (§ 146.7). Under § 146.1, these are minimum standards which, “if violated with a frequency that indicates a general business practice, will be deemed to constitute unfair claims settlement practices.”
Those standards apply to the insurer’s conduct, not to appraisal. Complaints about claim handling go to the Pennsylvania Insurance Department’s Bureau of Consumer Services — 1-877-881-6388 or ra-in-consumer@pa.gov. The timelines are set out in full on our denied claims page.
Frequently Asked Questions
No. Appraisal is a contractual process that exists because a policy contains an appraisal provision. There is no Pennsylvania statute or regulation that creates an appraisal right for first-party property claims. If your policy has no appraisal provision, appraisal is not available on that claim; if it has one, that provision — not state law — sets out how it works.
The amount of the loss. Appraisal is built for the situation where both sides agree the policy responds but disagree on what the damage comes to. Pennsylvania courts have drawn the line at coverage: where an insurer denies a claim by relying on a policy exclusion, that is a coverage dispute and is not the proper subject of appraisal. Where the parties disagree about the extent of the damage, or about whether a covered peril caused particular damage, that has been treated as a dispute about the amount of loss and therefore appropriate for appraisal.
In the usual structure, each side selects a competent appraiser, and the two appraisers attempt to agree on the amount of loss. If they cannot agree, they select an umpire, and an award agreed to by any two of the three sets the amount. The precise mechanics — including how an umpire is chosen if the appraisers cannot agree on one — are set by the policy language, so read your provision rather than assuming the standard form.
This is set by your policy. Many appraisal provisions state that each party pays its own appraiser and that the parties share the umpire’s costs and other expenses of the appraisal, but that allocation is a term of the contract and varies. Check the provision itself; do not assume.
Any deadline comes from your policy, not from Pennsylvania law, and appraisal provisions differ on this. Some condition the demand on events in the claim rather than on a fixed number of days. Because this varies and because missing a contractual deadline can matter, read your provision as soon as an amount dispute becomes apparent.
Whether and to what extent an award binds is determined by the policy language. Many provisions make the award binding as to the amount of loss while preserving the insurer’s right to deny on other grounds — which is another reason the coverage and amount questions are worth keeping separate in your own mind. What an award does not do is resolve a coverage dispute.
Possibly, and this is a question for an attorney rather than a public adjuster. Pennsylvania courts have enforced appraisal provisions as a contractual requirement, and where a policy requires compliance with appraisal before pursuing litigation, failing to comply has been held to bar suit under the policy. Because this is a legal question with real consequences, get legal advice rather than relying on a general description.
Related
Underpaid claims
Before appraisal: what to check on the insurer’s estimate, line by line.
Denied claims
If the claim was denied rather than underpaid, appraisal may not reach it.
Reopening a closed claim
Damage found after the file was closed.
How public adjusters are paid
What Pennsylvania law requires to be in the contract before you sign.
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Free Review — Including Your Appraisal Provision
Send us your policy and the insurer’s estimate. A licensed Pennsylvania public adjuster will read your appraisal provision and tell you whether the dispute you have is one appraisal can reach. No cost, no obligation. Or call 1-800-809-4302.