Appraisal Clause
A provision in most property policies letting either the insurer or the policyholder demand a binding valuation of a disputed loss amount, without going to court over it. Each side appoints its own appraiser, and if the two disagree, a neutral [[concept-appraisal-umpire|umpire]] breaks the tie.
Why it matters
Appraisal only resolves the amount of the loss, not whether the damage is covered at all. Coverage questions, whether something is owed in the first place, still have to be litigated or negotiated separately; appraisal is strictly a pricing mechanism.
On a real project
An adjuster and a public adjuster disagree by $40,000 on the cost to repair a storm-damaged roof after weeks of negotiation stall out. Either side invokes the appraisal clause, each appoints a competing appraiser, and when those two can't agree either, an umpire's number, combined with one appraiser's, becomes the final, binding award.
Who this matters most to
A Public Adjuster invokes appraisal on a policyholder's behalf once direct negotiation with the insurer has clearly stalled, since it forces a resolution without the cost and delay of a lawsuit.
Where this goes wrong
An insurer denies a legitimate coverage question, whether a particular type of damage is even covered, by mislabeling it an "amount of loss" dispute and pushing it into appraisal. Appraisal panels have no authority to decide coverage questions, only amount, so a policyholder's attorney has to intervene and pull the real coverage dispute back out of a process that was never built to resolve it.