The “State” of Insurance Appraisals in New York State

In November 2014, New York Governor Andrew Cuomo signed into law an important revision of the State Insurance statutes.

This law was a benefit to New York State insurance policyholders because it confirmed that the “scope of damage” of a claim was an allowable part of the insurance appraisal process.

Unfortunately, the passage of this law did not keep the insurance industry from trying to circumvent both the letter and spirit of the legislation. The New York Public Adjusters Association has been leading the fight against the insurance industry’s tactics to prevent policyholders from obtaining full and fair settlements.

Insurance appraisals have long been the go-to method of insurance claim disputes for both public adjusters and policyholders in New York State. An insurance appraisal effectively takes the claim settlement out of the hands of the insurance carrier and into the hands of an independent panel of 3.

Indeed, appraisals have been so effective for the policy holder that the carriers are now responding by taking certain steps to avoid appraisal and limit access to this amazingly effective method of dispute. Some examples:

  • We have seen insurance companies refuse an appraisal on the basis of coverage issues (which can only be settled by a court). Indeed, we have seen the rejection of the appraisal demand claiming coverage issues right in the same envelope with a check paying for the covered claim.
  • Carriers have also taken to issuing denials of reasonable and customary repair methods on a line by line basis to have those items removed from the appraisal process. (This is noteworthy because denials cannot be overturned by the appraisal panel).

The New York Public Adjusters Association has taken firm steps to counteract these practices. On a recent case the association and its president Bob D’Amore of D’Amore Adjusters put the weight of the organization into compelling an appraisal to establish some case law in addition to making the petition to compel an appraisal more simplified. Noted Insurance appraisal expert and NY attorney Jonathan Wilkofsky is moving these types of petitions into the courts to deflect these new tactics by the insurance carriers.

“We continue to move to keep the insurance appraisal process professional and transparent by keeping some of the required court petitions simple and accessible for the policy holders, even on smaller claims,” says D’Amore. “We hope in the coming year these court cases will begin to begin to have an impact on these carriers who try to employ these tactics in avoidance of an impartial appraisal.”

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