Weilers LLP

The Appraisal Remedy in Insurance Disputes

The Appraisal Remedy in Insurance Disputes

September 29, 2023

By Brian Babcock

If you have a claim for property damage under your insurance policy, a frequent issue is how much the damage is worth – either the value of what was destroyed, the cost of repair, or the residual value of the damaged item.

In Ontario, the Insurance Act provides a simple option to going to court to resolve this issue, called “appraisal”. This is done by a three-party panel. You and the insurer each appoint an “appraiser”, and they select an “umpire”. If they cannot agree on the choice of an umpire, the appointment must be settled by a judge. Unlike the appraiser, the umpire should be unbiased.

Typically, the insurer will appoint the adjuster or another company employee as their appraiser. You might hire a public adjuster or an expert in the subject matter – such as a mechanic for vehicle damage or an art dealer to value a painting.

In selecting your appraiser, you want someone with good knowledge and advocacy skills to convince the umpire. Not every subject-matter expert has that skill.

The procedure is informal, so it often will cost much less than a lawsuit and be quicker.

The umpire will often attempt a mediated solution, using their expertise to bring the parties together – absent that, the umpire will often pick one side or the other’s position, as at least one appraiser must agree with the umpire. For that reason, the umpire usually picks the more reasonable amount rather than inventing a third value.

Some appraisals are complex, with multiple issues or a need to have other experts provide information in the process. Many are straightforward.

There is no appeal from an appraisal. Judicial review is only available on the grounds of jurisdiction or misconduct.

If you suffer a property loss and the insurer and you do not agree as to your loss, you should consider legal assistance. You have rights and remedies. Weilers LLP has significant experience in representing clients in property insurance disputes, including advising as to navigating the appraisal process.