Because an appraisal award is generally treated as binding once reached, people sometimes ask whether there is any way to challenge an umpire’s decision if one side is unhappy with the outcome. The honest answer is that the grounds for challenging an award are typically narrow, though they do exist in limited circumstances.
Courts in many states have historically shown a strong preference for enforcing appraisal awards rather than reopening the underlying factual dispute over the value of a loss. This reflects the basic purpose of the appraisal clause, which is to provide a faster, more efficient alternative to litigation.
That said, awards can potentially be challenged in situations involving fraud, corruption, or a clear and significant procedural irregularity in how the appraisal was conducted, such as a lack of genuine independence from one of the appraisers or the umpire.
Simple disagreement with the outcome, or a belief that the umpire reached the wrong number, is generally not enough on its own to overturn an award in most jurisdictions. The bar for a successful challenge tends to be intentionally high.
Because the specific standards for challenging an award vary significantly from state to state, anyone who believes there was a genuine problem with how their appraisal was conducted should discuss the details with an attorney familiar with their state’s law.
This article is general education about how the appraisal process commonly works. It is not legal advice, and specific procedures can vary by state and policy. If you have questions about your own claim, review your policy language and talk with your insurance company, agent, or an attorney familiar with your state’s laws.
Russ Lis is a working property insurance appraiser and umpire based in Minnesota, serving clients nationwide. Have a question about your own claim? Contact Appraisal Resolution.