What is appraisal in homeowners insurance in California?

Home is where the heart is

-Proverb

Homeowners policies may require “appraisal.” Here’s what it is and what it means.

An appraisal is an informal hearing and is an example of ADR, or alternative dispute resolution. The insured (you) is generally responsible for showing the actual cash value (“ACV”) of the damaged property. If the insurer (your insurance company) disputes the ACV, then an appraisal may be used to resolve that dispute. Appraisals are generally subject to arbitration rules. So although there’s informality, there are still rules to follow.

California Insurance Code § 2071 provides that, if there’s a dispute, then either the insured or the insurer can request appraisal to determine the ACV. Once requested, the insured and the insurer select their own appraisers, whose only responsibility is to determine the ACV of items submitted to them. Remember, they cannot determine questions of coverage.

Both appraisers then select an umpire. Next, there’s a hearing where the insurer and insured put forward their experts or consultants before the two appraisers and the umpire. Once the hearing is concluded, two of the three decision-makers (the appraisers and umpire) agree on the ACV. Then the insurer must pay the insured that ACV.

If your insurance company refuses to pay you ACV and requests appraisal, you’re forced to incur expenses and likely hire a lawyer to go through the appraisal process and obtain what arguably you should have been paid in the first place.

Questions? Contact Me for a free consultation.

Evan Walker

Evan W. Walker is a La Jolla attorney who has practiced law since 2008. He has practiced law throughout California, Connecticut, and Louisiana.

Evan worked for and defended insurance companies during the first 7 years of his practice. Since 2015, he has represented people with personal injury and property damage claims and insurance disputes.

Evan’s practice is devoted to serious personal injury claims and catastrophic property damage claims. Areas of focus include security claims against bars and other businesses, government tort claims, fire and flood claims, and inverse condemnation. On behalf of clients, Evan has fought insurance firms, international companies, cities, bars, and casinos.

Evan regularly shares his expertise with other attorneys by teaching courses on insurance and inverse condemnation. He has taught several continuing legal education courses to Attorney Credits, a nationwide CLE company, and ProLawCLE, another nationwide CLE company. He also contributes to various podcasts and publications.

Associations:

  • Member, State Bar of California
  • Member, San Diego Bar Association
  • Member, Consumer Attorneys of California
  • Member, Consumer Attorneys of San Diego
  • Member, La Jolla Bar Association
  • Member, La Jolla Village Merchants Association
  • Member, San Diego Chamber of Commerce