Navigating Insurance Appraiser Denials and Complexities

When a property insurance claim is filed, the appraisal process is meant to offer a fair and efficient way to resolve disputes over the amount of loss. Each party selects an appraiser to assess the damage and, if they disagree, an impartial umpire is brought in to issue a binding decision. In theory, this process helps avoid litigation and speeds up claims.

But in practice, policyholders often encounter complications, especially when insurers delay or outright deny appraisal requests. Understanding how and why these denials happen is crucial to navigating what can quickly become a highly technical and contentious process.

What Is the Insurance Appraisal Process? 

The insurance appraisal process is a method used to resolve disputes about the amount of loss in a property damage claim. The purpose of appraisal is solely to determine how much a covered loss is worth, not whether the loss is covered in the first place.

Each party selects an independent appraiser, and those appraisers work together to agree on the value of the damages. If they can’t agree, a neutral umpire steps in to make a binding decision.

While this structure exists in policies nationwide, the procedural rules, like how appraisers are selected or how long parties have to respond, can vary depending on the jurisdiction and the exact language of the insurance contract.

How Is the Umpire Chosen? 

The process of selecting an umpire can vary based on policy language and jurisdictional rules, but it typically follows a few common steps. After each party selects its appraiser, the two appraisers are expected to agree on a neutral third-party umpire.

If they cannot agree within a set period, often specified in the policy, either party may petition a court to appoint the umpire. Some states require formal notice and judicial approval, while others allow for more informal agreements between the appraisers.

Regardless of the method, neutrality and impartiality are key to the umpire’s legitimacy.

Common Reasons Insurers Deny or Delay Appraisal 

Insurers may refuse or delay appraisal for reasons that seem legitimate, but often aren’t:

• Claim isn’t ripe: The insurer may argue appraisal is premature before their investigation is complete.
• Coverage in dispute: They may claim appraisal doesn’t apply because the dispute involves coverage, not value.
• Strategic delay: Some insurers deny appraisal just to stall the process and exhaust the policyholder.
• Procedural loopholes: Insurers might challenge appraisal demands over technicalities in timing or policy wording.

If your insurer denies appraisal, it doesn’t mean you’re out of options. In many cases, these denials can be challenged in court.

When Appraisal Is Weaponized 

Some insurers exploit the appraisal process to limit payouts or delay resolution:

• Lowball appraisers who are clearly biased toward the insurer
• Repeated postponements of selecting an umpire
• Refusal to sign off on binding awards
• Sudden refusal to proceed after accepting appraisal

These tactics create unnecessary complexity and confusion, often leaving policyholders with mounting repairs and no relief in sight. That’s when legal pressure becomes essential.

Legal Remedies for Denied Appraisals 

If your insurer denies appraisal, you may have legal grounds to compel participation or seek damages. Courts in Texas and other jurisdictions have held that appraisal can be enforceable even when coverage is in question, especially if the loss amount needs to be established first.

For example, in State Farm Lloyds v. Johnson, 290 S.W.3d 886 (Tex. 2009), the Texas Supreme Court upheld the enforceability of appraisal provisions and clarified that they apply to disputes over valuation, not coverage.

This ruling reinforces the legal boundary between appraisal and litigation: appraisers may determine how much a loss is worth, but they may not decide whether the loss is covered under the policy. That distinction is critical because it means that policyholders retain the right to pursue litigation for coverage issues even if appraisal resolves the value of damages.

Your legal options may include:

• Filing a declaratory judgment action
• Pursuing breach of contract
• Asserting bad faith under state insurance codes

At Daly & Black, we can help you determine the right course of action based on your policy, your state, and your unique situation.

How Daly & Black Fights Back 

Our firm doesn’t just guide clients through the appraisal process, we intervene aggressively when insurers misuse or deny it. When appraisal is unfairly blocked, we challenge those denials in court and pursue motions to compel participation or enforce prior awards. We also work closely with our clients to ensure their chosen appraisers are experienced, neutral, and prepared to stand up to the insurer’s position.

In cases where delay tactics or refusal to act in good faith are at play, we hold insurers accountable by asserting bad faith claims under applicable state laws. We’ve resolved appraisal disputes across a wide range of property damage cases, including hail, fire, flood, wind, and hurricane events, and we know how to apply strategic pressure to achieve results.

FAQ 

What is an insurance appraiser and what do they do?

An insurance appraiser is a neutral party hired by each side in a property damage dispute to estimate the amount of loss. If the two appraisers disagree, they work with an umpire to reach a binding decision.

What can I do if my insurance company refuses appraisal?

You may have the right to file legal action to enforce appraisal, particularly if the dispute centers on the value of the loss. A qualified attorney can review your policy and fight for your right to a fair process.

Can I sue if my appraisal demand is denied?

Yes. If the insurer is denying appraisal in bad faith or breaching your policy’s appraisal clause, you may be able to sue for breach of contract or seek declaratory relief.

Turning Appraisal Denials Into Legal Leverage

Don’t let an insurance company bury your claim behind red tape and fine print. When they try to deny, delay, or derail the appraisal process, we step in and fight back.Contact Daly & Black, P.C. for a free consultation. We’re ALL IN. ALL THE TIME.